basic income works

The current issue of Boston Review, a bimonthly American political and literary magazine, contains a forum on “Work Inequality Basic Income”. Here are excerpts from an online essay that contains links to numerous studies of basic income experiments. My only complaint is the neglect of the effect of income tests, which amount to a large taxes on earnings, with a predictably negative impact on employment.

In my opinion, the main problem with basic income is that most often it is not universal. Means tests (the lack of universality) stigmatizes beneficiaries, increases administration costs, and discourages recipients from working for pay.

The debate over basic income is awash in conjecture. Unfortunately facts have until recently been in short supply, as has credible research on the effects of giving people money—universally, basically, or otherwise. ….

Thankfully, we are less ignorant today. …. A large and growing body of rigorous evidence has now accumulated, including 165 studies of 56 different schemes in 30 countries recently reviewed by the Overseas Development Institute.

The findings are encouraging. The darkest of concerns have not materialized: recipients of regular transfers have not cut their work hours, and if anything have cut their expenditure on alcohol and tobacco. Cash transfers have had positive impacts on a wide range of outcomes, and in some cases have indeed increased self-employment and earnings. ….

There is also positive but more limited evidence from the United States. Payouts to Cherokee families from a new casino resulted in dramatic psychological improvements and reductions in crime for the children of those families. A conditional cash program in New York City found reductions in poverty, and a very long-term study of programs from the early twentieth century found that small cash grants to poor families could add a year of life to their children.

Paul Niehaus and Michael Faye, “Basic Income Works“, Boston Review, online supplement to the Spring 2007 issue.

Ungated articles from the Spring 2017 print edition are available at the link above, including Brishen Rogers, “Basic Income in a Just Society”, Anke Hassel, “Basic Income Is a Dead End” and The Undercommons, “No Racial Justice Without Basic Income”.


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