Poorly applied benefits do. If at any point, you lose $2 of benefits by earning $1 more, you are encouraged to not work harder. Of course there is a cap, such as if you earn $5,000 more you'll only lose $4,000, but people don't have the option to increase by $5,000 at a time and are stuck where working harder only earns you enough to cost even more in benefits than you earn, thus discouraging working harder.