In this commentary, for the IFS Deaton Review of Inequalities, on transfers, taxes, and tax credits for those on low incomes, I bring a US perspective to the long-standing question of how to structure the tax-and-transfer system in order to provide income support to families at the bottom of the income distribution, but while simultaneously providing incentives to work and attempting to improve the level of earnings that individuals in those families can achieve. This is a topic of decades of research and thinking by economists. I divide my commentary into three parts, with each section building on the previous one: (1) the Mirrlees problem; (2) conditionality; and (3) training and human capital policies. The title of the commentary refers to my suggestion that thinking about the design of transfer programmes goes beyond the Mirrlees framework and considers programmes with types of conditionality and types of training and human capital programmes.

Cite this as:

Moffitt, R. (2023), ‘Transfers, taxes, and tax credits for those on low incomes: beyond Mirrlees’, IFS Deaton Review of Inequalities, https://ifs.org.uk/inequality/transfers-taxes-and-tax-credits-on-low-incomes