How Economic Inequality Has Increased by Tax Cuts? Power-Based Modular Supervisory Control of Discrete Event Systems

Abstract

This technical note presents a new modular supervisory control based on powers in which an event is enabled if the total power of local controllers to enable it is greater than the total power of local controllers to disable it. We present the conditions of controllability and power-observability of a common control objective of all local controllers to achieve the objective by modular control. Then, we apply the proposed power-based modular control scheme to the political economy problem: How economic inequality has increased by tax cuts? Even though most ordinary citizens of the United States believe that growing economic inequality is a bad thing, they supported tax cuts leading to the massive upward transfer of wealth since 1980. This technical note shows that this contradiction can be analyzed using the notion of power-observability which implies that if most citizens would have been well-informed, they would have opposed the tax cuts and politicians could have not easily pushed such policies to increase inequality.