welfare cliff

Assistance cutoff threshold

The welfare cliff is the sharp loss of government benefits that occurs when a small increase in income pushes someone past an eligibility threshold.

A modest raise might cost more in lost benefits—food assistance, healthcare subsidies, housing vouchers—than the additional earnings provide.

She turned down the promotion because of the welfare cliff.

The phenomenon creates a perverse incentive against economic advancement, trapping recipients in a narrow income band.

Related

trap · safety net · public assistance · cutoff · income · assistance · disincentive · SNAP · food stamps · Medicaid · housing · childcare · eligibility · marginal · tax · work · getting ahead · making ends meet

Categories
Opposites
benefit transition structure

welfare cliffsmooth transition

Gradual, unnoticeable change

sliding scale · soft landing · glide path · phaseout · gradual reduction

policy design philosophy

welfare cliffuniversal basic income

Guaranteed payments to all

UBI

Family

welfare, cliff, cliffs, well, fare, fares, fared, faring, farewell

Familiarity
Top 500,000
Profile
Mostly American · Timeless · Abstract · Negative · Rated G