How analyze proposals

To analyze these proposals, we need to address a simple but subtle question:
When the government levies a tax on a good, who bears the burden of the tax? The
people buying the good? The people selling the good? Or, if buyers and sellers
share the tax burden, what determines how the burden is divided? Can the government
simply legislate the division of the burden, as the mayor is suggesting, or
is the division determined by more fundamental forces in the economy? Economists
use the term tax incidence to refer to these questions about the distribution
of a tax burden. As we will see, we can learn some surprising lessons about tax incidence
just by applying the tools of supply and demand.