Answer:
(i) the welfare system
(ii) unemployment insurance
(iii) progressive income tax
Step-by-step explanation:
In this context, 'reduced efficiency' refers to a situation where government's decision to use its budget might not be the best decision to increase its income.
- Welfare system
Taken from the government budget to be spread among the citizens in the form of food or health care
- Unemployment insurance
Taken from the government budget to sustain the life of those who cannot find works in the market.
- Progressive income tax
Increasing the number of tax taken as the amount of earning increase.
Every dollar taken from the budget to be spread to help the citizens can be considered as reduction of efficiency because those dollar could've been allocated to other investment that generate income.
As for progressive income tax, the more money taken from the people, the lesser amount of investment that they will make in the market. This will also reduce the government income in the long run.
That being said, less efficiency in earning income does not necessarily mean it's a bad decision. One might argue that As a country, it is an ethical behavior for the government to facilitate some sort of help for the citizens in need.