> Alternatively, the benefit can be on a decreasing curve / phased out to prevent these cliff situations?

That’s not an alternative to UBI, that’s what UBI (in a system which has income taxes) is. The marginal income tax rate provides the phased reduction in effective benefits.

That’s better, but still inefficient. One example is a minimum guaranteed income. There is no cliff, but it removes the financial incentive to work more or find a better job for people earning below the threshold.

The conspiracy theory is that it's to deliberately keep people poor and suffering. Hanlon's razor and all, but it's hard to come up with another justification.

Anyone work in government or know a lot about the relevant history? Is there a good reason why it works like this?

It disincentivizes people to ask for raises. That's a feature if you run a business.

I'm skeptical of the idea that it was accidental.

Isn’t a cliff simply a ramp with infinite slope? I would suspect the problem is that if we can’t tune something as simple as a step function correctly (which is just an x intercept), it seems even less likely we would be able to tune a ramp (more variables - x intercept and a slope, and that’s assuming it should even be linear instead of e.g. quadratic).

> Isn’t a cliff simply a ramp with infinite slope? I would suspect the problem is that if we can’t tune something as simple as a step function correctly (which is just an x intercept), it seems even less likely we would be able to tune a ramp (more variables - x intercept and a slope, and that’s assuming it should even be linear instead of e.g. quadratic).

One of the challenges of tuning means-tested welfare phase-outs is that means-tested welfare consists of dozens of different programs, most of which have additional qualifications besides the means test, governed by different levels of government, often with different definitions of what income counts against the phaseout.

UBI makes that simpler by consolidation.

Something as simple as “for each $1.00 you earn above the eligibility threshold, this benefit will decrease by $0.50.” would do the trick.

For those close to the line, there would always be a benefit to accepting that slightly better job.