Definition, Meaning & Synonyms
trickle-down-effect
noun
/ˈtrɪk.əlˈdaʊn ɪˌfɛkt/
Definition
The trickle-down effect is an economic concept which suggests that benefits provided to the wealthy and businesses will eventually be passed down to the less affluent members of society.
Examples
- The government implemented tax cuts hoping to stimulate the economy through the trickle-down effect.
- Critics argue that the trickle-down effect does not work in practice and benefits only the wealthy.
Meaning
It implies that when the upper class or corporations receive tax cuts or economic benefits, they will invest or spend that wealth, leading to job creation and ultimately benefiting the lower economic classes.
Synonyms
- Supply-side economics
- Economic growth theory
