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Universal basic income

Universal basic income (UBI)[note 1] is a social welfare proposal in which all citizens of a given population regularly receive a minimum income in the form of an unconditional transfer payment, i.e., without a means test or need to work.[2][3][4] In contrast a guaranteed minimum income is paid only to those who do not already receive an income that is enough to live on. A UBI would be received independently of any other income. If the level is sufficient to meet a person's basic needs (i.e., at or above the poverty line), it is sometimes called a full basic income; if it is less than that amount, it may be called a partial basic income.[5] As of 2024, no country has implemented a full UBI system, but two countries—Mongolia and Iran—have had a partial UBI in the past.[6] There have been numerous pilot projects,[7] and the idea is discussed in many countries. Some have labelled UBI as utopian due to its historical origin.[8][9][10]

"Basic income" redirects here. For other basic income models, see List of basic income models.

There are several welfare arrangements that can be considered similar to basic income, although they are not unconditional. Many countries have a system of child benefit, which is essentially a basic income for guardians of children. A pension may be a basic income for retired persons. There are also quasi-basic income programs that are limited to certain population groups or time periods, like Bolsa Familia in Brazil, which is concentrated on the poor, or the Thamarat Program in Sudan, which was introduced by the transitional government to ease the effects of the economic crisis inherited from the Bashir regime.[11] Likewise, the economic impact of the COVID-19 pandemic prompted some countries to send direct payments to its citizens. The Alaska Permanent Fund is a fund for all residents of the U.S. state of Alaska which averages $1,600 annually (in 2019 currency), and is sometimes described as the only example of a real basic income in practice. A negative income tax (NIT) can be viewed as a basic income for certain income groups in which citizens receive less and less money until this effect is reversed the more a person earns.[12]


Critics claim that a basic income at an appropriate level for all citizens is not financially feasible, fear that the introduction of a basic income would lead to fewer people working, and/or consider it socially unjust that everyone should receive the same amount of money regardless of their individual need. Proponents say it is indeed financeable, arguing that such a system, instead of many individual means-tested social benefits, would eliminate much expensive social administration and bureaucratic efforts, and expect that unattractive jobs would have to be better paid and their working conditions improved because there would have to be an incentive to do them when already receiving an income, which would increase the willingness to work. Advocates also argue that a basic income is fair because it ensures that everyone has a sufficient financial basis to build on and less financial pressure, thus allowing people to find work that suits their interests and strengths.[13]


Early examples of unconditional payments to citizens date back to antiquity, and the first proposals to introduce a regular unconditionally paid income for all citizens were developed and disseminated between the 16th and 18th centuries. After the Industrial Revolution, public awareness and support for the concept increased. At least since the mid-20th century, basic income has repeatedly been the subject of political debates. In the 21st century, several discussions are related to the debate about basic income, including those concerning the automation of large parts of the human workforce through artificial intelligence (AI), and associated questions regarding the future of the necessity of work. A key issue in these debates is whether automation and AI will significantly reduce the number of available jobs and whether a basic income could help prevent or alleviate such problems by allowing everyone to benefit from a society's wealth, as well as whether a UBI could be a stepping stone to a resource-based or post-scarcity economy.

Psychological. Philip Harvey accepts that "both systems would have the same redistributive effect and tax earned income at the same marginal rate" but does not agree that "the two systems would be perceived by taxpayers as costing the same".: 15, 13 

[47]

Tax profile. made a distinction based on whether the tax profile was flat (for basic income) or variable (for NIT).[48]

Tony Atkinson

Timing. states that "the economic equivalence between the two programs should not hide the fact that they have different effects on recipients because of the different timing of payments: ex-ante in Basic Income, ex-post in Negative Income Tax".[49]

Philippe Van Parijs

The diagram shows a basic income/negative tax system combined with flat income tax (the same percentage in tax for every income level).


Y is here the pre-tax salary given by the employer and y' is the net income.


Negative income tax


For low earnings, there is no income tax in the negative income tax system. They receive money, in the form of a negative income tax, but they do not pay any tax. Then, as their labour income increases, this benefit, this money from the state, gradually decreases. That decrease is to be seen as a mechanism for the poor, instead of the poor paying tax.


Basic income


That is, however, not the case in the corresponding basic income system in the diagram. There everyone typically pays income taxes. But on the other hand, everyone also gets the same amount of basic income.


But the net income is the same


But, as the orange line in the diagram shows, the net income is anyway the same. No matter how much or how little one earns, the amount of money one gets in one's pocket is the same, regardless of which of these two systems are used.


Basic income and negative income tax are generally seen to be similar in economic net effects, but there are some differences:

In negative income tax experiments in the United States in 1970 there was a five percent decline in the hours worked. The work reduction was largest for second earners in two-earner households and weakest for primary earners. The reduction in hours was higher when the benefit was higher.

[74]

In the experiment in rural Dauphin, Manitoba, also in the 1970s, there were slight reductions in hours worked during the experiment. However, the only two groups who worked significantly less were new mothers, and teenagers working to support their families. New mothers spent this time with their infant children, and working teenagers put significant additional time into their schooling.[77]

Mincome

A study from 2017 showed no evidence that people worked less because of the (a basic income reform).[78]

Iranian subsidy reform

Experiments with in the United States and Canada in the 1960s and 1970s.

negative income tax

The province of , Canada experimented with Mincome, a basic guaranteed income, in the 1970s. In the town of Dauphin, Manitoba, labor only decreased by 13%, much less than expected. This program was ended after issues with the cost becoming unsustainable started to arise.[86][87]

Manitoba

Pension: A payment that in some countries is guaranteed to all citizens above a certain age. The difference from true basic income is that it is restricted to people over a certain age.

: A program similar to pensions but restricted to parents of children, usually allocated based on the number of children.

Child benefit

: A regular payment given to families, but only to the poor. It is usually dependent on basic conditions such as sending their children to school or having them vaccinated. Programs include Bolsa Família in Brazil and Programa Prospera in Mexico.

Conditional cash transfer

differs from a basic income in that it is restricted to those in search of work and possibly other restrictions, such as savings being below a certain level. Example programs are unemployment benefits in the UK, the revenu de solidarité active in France, and citizens' income in Italy.

Guaranteed minimum income

2008: An official petition for basic income was launched in Germany by .[131] The petition was accepted, and Susanne Wiest was invited for a hearing at the German parliament's Commission of Petitions. After the hearing, the petition was closed as "unrealizable".[132]

Susanne Wiest

2013–2014: A collected 280,000 signatures demanding that the European Commission study the concept of an unconditional basic income.[133]

European Citizens' Initiative

2015: A citizen's initiative in Spain received 185,000 signatures, short of the required number to mandate that the Spanish parliament discuss the proposal.

[134]

2016: The world's first universal in Switzerland on 5 June 2016 was rejected with a 76.9% majority.[135][136] Also in 2016, a poll showed that 58% of the EU's population is aware of basic income, and 64% would vote in favour of the idea.[137]

basic income referendum

2017: Politico/Morning Consult asked 1,994 Americans about their opinions on several political issues including national basic income; 43% either "strongly supported" or "somewhat supported" the idea.

[138]

2018: The results of a poll by conducted last year between September and October were published. 48% of respondents supported universal basic income.[139]

Gallup

2019: In November, an Austrian initiative received approximately 70,000 signatures but failed to reach the 100,000 signatures needed for a parliamentary discussion. The initiative was started by Peter Hofer. His proposal suggested a basic income sourced from a financial transaction tax, of €1,200, for every Austrian citizen.

[140]

2020: A study by found that 71% of Europeans are now in favour of basic income. The study was conducted in March, with 12,000 respondents and in 27 EU-member states and the UK.[141] A YouGov poll likewise found a majority for universal basic income in United Kingdom[142] and a poll by University of Chicago found that 51% of Americans aged 18–36 support a monthly basic income of $1,000.[143] In the UK there was also a letter, signed by over 170 MPs and Lords from multiple political parties, calling on the government to introduce a universal basic income during the COVID-19 pandemic.[144]

Oxford University

2020: A survey, conducted online in August 2020, of 11,000 U.S. adults found that a majority (54%) oppose the federal government providing a guaranteed income of $1,000 per month to all adults, while 45% support it.[145]

Pew Research Center

2020: In a poll by , 55% of Americans voted in favour of UBI in August, up from 49% in September 2019 and 43% in February 2019.[146]

Hill-HarrisX

2020: The results of an online survey of 2,031 participants conducted in 2018 in Germany were published: 51% were either "very much in favor" or "in favor" of UBI being introduced.

[147]

2020: An October survey of 1,026 Australians by YouGov found a 58% support for universal basic income.

[148]

2021: A petition calling for monthly stimulus checks in the amount of $2,000 per adult and $1,000 per child for the remainder of the COVID-19 pandemic had received almost 3 million signatures.[149]

Change.org

The Future of Social Security Policy: Women, Work and a Citizens Basic Income, Routledge, 2005, ISBN 9781134287185

Ailsa McKay

Karl Widerquist, Jose Noguera, Yannick Vanderborght, and Jurgen De Wispelaere (editors). Archived 14 September 2019 at the Wayback Machine, Oxford: Wiley-Blackwell, 2013.

Basic Income: An Anthology of Contemporary Research

Colombino, U. (2015). (PDF). Italian Economic Journal. 1 (3): 353–389. doi:10.1007/s40797-015-0018-3. S2CID 26507450. Archived (PDF) from the original on 29 December 2022. Retrieved 2 September 2019.

"Five Crossroads on the Way to Basic Income: An Italian Tour"

Karl Widerquist, ed., Archived 23 June 2016 at the Wayback Machine, (book series), Palgrave Macmillan.

Exploring the Basic Income Guarantee

Paul O'Brien, Universal Basic Income: Pennies from Heaven, The History Press, 2017,  978 1 84588 367 6.

ISBN

"Born to Be Free" (review of Philippe Van Parijs and Yannick Vanderborght, Basic Income: A Radical Proposal for a Free Society and a Sane Economy, Harvard University Press, 2017), The New York Review of Books, vol. LXIV, no. 15 (12 October 2017), pp. 39–41.

Benjamin M. Friedman

Marinescu, Ioana (February 2018). . NBER Working Paper No. 24337. doi:10.3386/w24337.

"No Strings Attached: The Behavioral Effects of U.S. Unconditional Cash Transfer Programs"

Ewan McGaughey, ' Archived 24 May 2018 at the Wayback Machine' (2018) SSRN Archived 24 May 2018 at the Wayback Machine, part 4(2).

Will Robots Automate Your Job Away? Full Employment, Basic Income, and Economic Democracy

The War on Normal People, Hachette Books, 3 April 2018

Andrew Yang

Lowrey, Annie (2018). Give People Money: How a Universal Basic Income Would End Poverty, Revolutionize Work, and Remake the World. Crown.  978-1524758769.

ISBN

Bullshit Jobs, Simon & Schuster, May 2018, ISBN 9781501143311

David Graeber

Bryce Covert, "What Money Can Buy: The promise of a universal basic income – and its limitations", , vol. 307, no. 6 (10 / 17 September 2018), pp. 33–35.

The Nation

"Good New Idea: John Lanchester makes the case for Universal Basic Income" (discusses 8 books, published between 2014 and 2019, comprehensively advocating Universal Basic Income), London Review of Books, vol. 41, no. 14 (18 July 2019), pp. 5–8.

John Lanchester

By date of publication:

Basic Income Earth Network

Basic Income India

Basic Income Lab (BIL)

Citizen's Basic Income Trust

Archived 16 May 2022 at the Wayback Machine (in Spanish)

Red Humanista por la Renta Básica Universal

Unconditional Basic Income Europe

v:Should universal basic income be established?

. TED Talk on YouTube by Rutger Bregman. Uploaded 21 October 2014.

Why we should give everyone a basic income | Rutger Bregman | TEDxMaastricht