Answer
Antipoverty programs might discourage the poor from working by guaranteeing a set level of income or benefits. Additionally, the programs might allow workers to lose on-the-job training by guaranteeing the set level of income or benefits.
Work Step by Step
This disincentive could be reduced by a more gradual decrease of benefits as workers earn more money. The disadvantage of the decrease is that there might be a marginal tax rate of more than 100 percent. (This means that the families are worse off when they make more.)
