. . .welfare programs lead to very high implicit marginal tax rates on low-income people. More specifically, they lose handouts when they earn income. As such, it is not very advantageous for them to climb the economic ladder because hard work is comparatively unrewarding.
Thanks to the American Enterprise Institute, we now have a much more detailed picture showing the impact of redistribution programs on the incentive to earn more money.
Read more by Dan Mitchell
- Why welfare, food stamps, and other programs often discourage work
- You Didn’t Earn That
- It Doesn’t Pay to Work
- Why All My Ex’s Live In Texas
- Fight For Your Right To Government Dependency
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