{"id":18835,"date":"2013-01-07T09:05:01","date_gmt":"2013-01-07T09:05:01","guid":{"rendered":"http:\/\/www.taxresearch.org.uk\/Blog\/?p=18835"},"modified":"2013-01-07T09:05:03","modified_gmt":"2013-01-07T09:05:03","slug":"whos-to-blame-for-the-myth-that-companies-must-avoid-tax-lets-start-with-economists","status":"publish","type":"post","link":"https:\/\/www.taxresearch.org.uk\/Blog\/2013\/01\/07\/whos-to-blame-for-the-myth-that-companies-must-avoid-tax-lets-start-with-economists\/","title":{"rendered":"Who’s to blame for the myth that companies must avoid tax? Let’s start with economists"},"content":{"rendered":"

I've noted this morning<\/a> that far from\u00a0there\u00a0being a legal obligation on companies to avoid tax, this action is probably contrary to the law (as well, as is now clear, good commercial practice, which happen to\u00a0coincide\u00a0on this issue). So in that case, who\u00a0created\u00a0the myth?<\/p>\n

I think the finger can be unambiguously pointed at micro-economists. Because this breed has over the last 60 or so years become obsessed with seeking to solve all problems mathematically they have to make massive simplifying\u00a0assumptions\u00a0about the\u00a0true\u00a0nature of\u00a0human\u00a0(and so\u00a0corporate)\u00a0behaviour\u00a0to reduce life to terms that they can handle in their equations. One of those massive assumptions is that\u00a0\u00a0companies\u00a0have a\u00a0duty\u00a0to maximise profits. If they did not make this assumption they \u00a0could not\u00a0otherwise\u00a0 mathematically model\u00a0corporate\u00a0behaviour in the abstract, as they do, rather than look at its reality, which they don't.<\/p>\n

But the fact that there is a \u00a0fundamental flaw at the heart of conventional microeconomics because it is built on an assumption that is not only wrong,because as a matter of fact companies do not only not maximise profit but would have no clue what to do if instructed to do so, does not make that false assumption right. It should just instead lead us to doubt the advice of those who offer suggestion on the basis of such falsehoods.<\/p>\n

And nor does an economist's false assumption create law that does not exist.<\/p>\n","protected":false},"excerpt":{"rendered":"

I’ve noted this morning that far from\u00a0there\u00a0being a legal obligation on companies to avoid tax, this action is probably contrary to the law (as well,
 Read the full article…<\/em><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[35],"tags":[],"class_list":["post-18835","post","type-post","status-publish","format-standard","hentry","category-economics"],"_links":{"self":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/posts\/18835","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/comments?post=18835"}],"version-history":[{"count":0,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/posts\/18835\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/media?parent=18835"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/categories?post=18835"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/tags?post=18835"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}