If the punishment for convicted drug-dealers increases, the wages of the crime family's workers will fall. Increased punishments make drug-dealing a less pleasant job. This reduces supply, raising the wages for drug-dealing. Suppose the government bans deductibles on health insurance. There is a basic difference between transfers and deadweight costs.
Transfers take wealth from some and give to others.
The deadweight costs of banning deductibles arise because some people who would have been willing to buy a cheap policy with a deductible won't buy an expensive policy without a deductible. Also, banning deductibles increases the number of accidents without making anyone better off. In 4-6 sentences, answer both of the following questions. Neatly show both effects on one diagram. Then carefully explain the combined consequences of these policies on wages and employment.