If redistributive programs do not discourage work, then guaranteed income paired with high phaseout rates optimizes social welfare functions

Many traditional economic models assume that if workers receive unconditional transfers, like basic income, they will reduce their working hours. However, recent experimental evidence contradicts this long-held assumption. In theory, if unconditional cash doesn't discourage work, it better optimizes a social welfare function that programs conditional on work, like earned income credit programs.

theoretical


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