Good find. It's worth noting though that the author is discussing the 'Jersey Experiment', which implemented an 'impure' form of the NIT: Thus, a treatment mig

Good find. It's worth noting though that the author is discussing the 'Jersey Experiment', which implemented an 'impure' form of the NIT: Thus, a treatment might offer a guarantee equal to half the poverty line, which was then about $8,000 for a family of four, with benefits being reduced by 50 percent of the family's income. When income was zero, the family would receive the full $4,000 (50 percent of $8,000). When income reached $8,000, the benefit would be reduced to zero and the family would "break even" (i.e., neither receive negative taxes nor pay positive taxes). This is basically the opposite of a 'pure' NIT: where earnings do not affect the annual cash amount handed out by the government. In other words, under an NIT, the government would be sending the same amount of money to Bill Gates as they would send to its poorest citizen. The NIT discussed above meant that recipients faced at least a 50% effective marginal tax rate on their first $8000 of earnings, which is a pretty significant disincentive to work. The whole point of an NIT is to avoid this 'welfare trap' effect.