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Chapter 15: Q 20. (page 377)

What is the safety net?

Short Answer

Expert verified

Safety-net refers to the welfare and anti-poverty programs implemented by the US government for the poor and the near-poor of the country.

Step by step solution

01

Step 1. Introduction

The government of a country is entitled to the responsibility of safeguarding its people in the country, especially the poor or the low-wage earners. The government takes steps for increasing the welfare of the poor in the country.

02

Step 2. Safety net

For the purpose of increasing the welfare of the poor (who lie below the poverty line) and the near-poor (who earns just above the poverty line), the US government launches many welfare and anti-poverty programs in the country. These programs are considered as safety-net provided by the government.

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Most popular questions from this chapter

The poverty rate would be substantially lower if the market value of in-kind transfers were added to family income. The largest in-kind transfer is Medicaid, the government health program for the poor. Lets say the program costs \(10,000 per recipient family.

a. If the government gave each recipient family a \)10,000 check instead of enrolling them in the Medicaid program, do you think that most of these families would spend that money to purchase health insurance? Why? (Recall that the poverty level for a family of four is about $25,000.)

b. How does your answer to part (a) affect your view about whether we should determine the poverty rate by valuing in-kind transfers at the price the government pays for them? Explain.

c. How does your answer to part (a) affect your view about whether we should provide assistance to the poor in the form of cash transfers or in-kind transfers? Explain.

What goods and services would you include in an

estimate of the basic necessities for a family of four?

Who is included in the top income quintile?

How does the TANF attempt to loosen the poverty trap?

What are the main reasons economists give for the

increase in inequality of incomes?
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