trickle-down effect

Syllable breakdown

Dictionary meaning

the controversial theory that economic benefits granted to wealthy individuals and large corporations, such as tax cuts or deregulation, will eventually flow downward through the economy and benefit lower-income groups through job creation, investment, and spending; the term is largely pejorative in academic economics, where critics argue the empirical evidence for downward wealth diffusion is weak and that such policies primarily increase inequality; nonetheless, trickle-down arguments remain influential in political debates about tax policy and the relationship between growth and distribution