It is of central importance to first understand the capital formation and functional representation theory. This will be vital in providing a comprehensive and an in depth understanding of the objectives that the current study strives to satisfy. This is an economic paradigm, which primarily involves or accounts for the net additions of capital stocks including buildings and equipment. Capital stock in a nation is usually used in line with labor to produce goods and provide essential services. According to Armey and Kibbe (2011), when the level of capital formation is high, the economy is placed in a better position to grow its aggregate income at a faster speed. Apart from this, as Rasmussen and Schoen (2010) noted, seeking to raise the level
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As a recap, at the core of the theory is the idea that where the capital formation is high, the economic benefits of people within a nation are high. The Tea Party Movement often deems some of the policies by the federal government as despising or overruling the essence of capital formation. Take an instance of the system of taxing. According to Burghart and Zeskind (2010), everything within the American society is taxed, with the level of taxes exceeding what is normally charged by other nations. This, according to the researcher, is detrimental as it often discourages new investments in capital. Williamson, Skocpol and Coggin (2011) pointed out that where an investor perceives that the level of taxes is essentially and unwarrantedly high especially in the capital sector, it is highly possible that the investor will seek to avoid the industry. This is detrimental as it leads to a situation where excessive labor is available, but the level of investments that provide employment is low. This is not an ideal situation or state for an economy and the subsequent income. There is a need for the policies to support capital formation in order to ensure high or favorable income for the public. However, with inappropriate governmental policies, such an outcome cannot be achieved. Therefore, based on the capital formation and functional representation theory, the goals of the Tea Movement Party are
As a recap, at the core of the theory is the idea that where the capital formation is high, the economic benefits of people within a nation are high. The Tea Party Movement often deems some of the policies by the federal government as despising or overruling the essence of capital formation. Take an instance of the system of taxing. According to Burghart and Zeskind (2010), everything within the American society is taxed, with the level of taxes exceeding what is normally charged by other nations. This, according to the researcher, is detrimental as it often discourages new investments in capital. Williamson, Skocpol and Coggin (2011) pointed out that where an investor perceives that the level of taxes is essentially and unwarrantedly high especially in the capital sector, it is highly possible that the investor will seek to avoid the industry. This is detrimental as it leads to a situation where excessive labor is available, but the level of investments that provide employment is low. This is not an ideal situation or state for an economy and the subsequent income. There is a need for the policies to support capital formation in order to ensure high or favorable income for the public. However, with inappropriate governmental policies, such an outcome cannot be achieved. Therefore, based on the capital formation and functional representation theory, the goals of the Tea Movement Party are