Unconditional Cash Study: first findings available

$1000 is not enough to quit their jobs or get a nice apartment. They could move slightly closer to work if they have to commute.

It's not enough for a real tuition or to support them to study instead of work.

I don't think we've ever had a universal basic income test. We have always missed the universal and basic part. It's below basic and not at all universal.

I suspect that you need to get international cooperation and a more sophisticated form of money and resource tracking for a real UBI to be feasible.

This is a pretty generous reading of the study.

One result they are missing out is that the income actually reduced overall employment compared to the control group, and ended up decreasing household earnings: https://www.nber.org/papers/w32719

Even with a generous reading, it was an extremely expensive study. And similar proposals like the Negative Income Tax would cost far less money and have none of the presented downsides.

I'm not sure how to address this, but I always wonder how much we can extrapolate the findings from these studies to a universal basic income situation. I feel like giving a small group of people an extra $12000 a year provides benefits for low income people because their yearly income is now higher compared to the median income. Someone who's income is in the 5th percentile may now be in the 10th or 15th percentile (no idea if those numbers are correct).

Once you give everybody an extra $12000 a year, the median income is now $12000 higher. I'm sure there's still some benefit, but relative to others their position hasn't changed. Someone who's yearly income is in the 5th percentile is still earning in the 5th percentile.

I'm concerned about a situation similar to college tuition in the US where easy, risk free money leads to price gouging. Once everyone has an extra $XXXXX how quickly does the market realize that the cost of goods can be raised by that amount.

Link to the preliminary study results from OpenResearch: https://www.openresearchlab.org/studies/unconditional-cash-s...

Note that this was a time-limited study where participants knew they would only receive money for 3 years. Personally, I feel like this leads to different behaviors than if people believe they will receive the income indefinitely.

The problem with this kind of test is that the people still live in a society where cheap labor is available to the companies around them that provide them with all the goods and services that they like to purchase with those $1000 (or whatever free amount they've gotten). Germany shifted to a system that is as close to a basic income as you can currently imagine. There are some strings attached, but considerably less than in the past. You can easily live from the "Bürgergeld", but the labor market currently takes a third hit after Covid and Russia's full scale invasion on Europe: lots of companies, especially labor intensive services like bars and restaurants, have serious trouble to hire staff. The only way is to offer higher salaries – which, in turn, needs to be paid by the customers. This makes goods and services less affordable for everyone, but especially for those relying on government money...

As others have pointed out [0], the summaries have a much more positive spin than the accompanying paper [1].

The paper's abstract:

> We study the causal impacts of income on a rich array of employment outcomes, leverag-ing an experiment in which 1,000 low-income individuals were randomized into receiving $1,000 per month unconditionally for three years, with a control group of 2,000 participants receiving $50/month. We gather detailed survey data, administrative records, and data from a custom mobile phone app. The transfer caused total individual income to fall by about $1,500/year relative to the control group, excluding the transfers. The program resulted in a 2.0 percentage point decrease in labor market participation for participants and a 1.3-1.4 hour per week reduction in labor hours, with participants’ partners reducing their hours worked by a comparable amount. The transfer generated the largest increases in time spent on leisure, as well as smaller increases in time spent in other activities such as transportation and finances. Despite asking detailed questions about amenities, we find no impact on quality of employment, and our confidence intervals can rule out even small improvements. We observe no significant effects on investments in human capital, though younger participants may pursue more formal education. Overall, our results suggest a moderate labor supply effect that does not appear offset by other productive activities.

[0] https://x.com/Afinetheorem/status/1815413121822896270

[1]https://www.openresearchlab.org/findings/nber-working-paper-...

If you were to hand out $1k a month to everyone in my area an immediate result would likely be that rents would increase by somewhere close to $1k a month.

Everyone needs somewhere to live. Everyone wants to live closer to where they work and where there friends and family are. Housing is in limited supply. If everyone had more purchasing power, then everyone's going to collectively bid up what they're willing to pay for housing simply because they can.

Completely devastating results for promoting free money. 1k a month and the "benefits" are some minor lifestyle changes.

No impact on health. Biggest spending beverages. Slightly less time spent working. Some people start budgeting (presumably to figure out how to spend the money). And black people start businesses.

There are 300M people in the US. Giving 1k to each every month is 3.6T a year. And the effects are miniscule. With 3.6T you could do a lot of things. Just reversing the trend of obesity would be a major improvement for the lives of millions.

I used to support UBI but after seeing the US stimulus money get socked away into savings and the stock market, leading to rising prices and inflation, I no longer support it. I think all it will do is raise the cost of nearly everything and those that couldn’t afford the basics still won’t be able to since they’ll be more expensive.

Two other studies on slightly different cash transfer programs:

https://www.who.int/tools/elena/review-summaries/cash-transf...

https://epar.evans.uw.edu/blog/long-term-impacts-cash-transf....

I don't see how UBI can work, on a nationwide scale it means everyone got x% more money and the market would adjust itself accordingly by raising prices?

Also UBI is funded by taxes, which if applied to middle class they will vote against you. And if applied to companies, they push it down on the customer, making everything cost more (and therefore negating the UBI effect).

What probably would be more effective for society would be improved an ACA, a cap on healthcare costs for all if you will and free yearly health checkups.

UBI at this time is like topical ointment on a festering wound. Americans first need livable wages and single-payer healthcare that isn't Medicare, which is a Byzantine, confusing maze of dozens of coverage options largely outsourced to for-profit corporations.

I am not sure how small studies can account for the inflation wide rollout could cause. Consider this hypothetical: If you give 1 of 1000 renters $100, 1 landlord will leave the rent alone because they don't know. If you give 1000 of 1000 renters $100, word will get to 1000 landlords, who will all increase rent $100, because the market will bear it. I'm not saying this will happen, just that a small study enjoys the benefits of anonymity.

I don't understand why all of the basic income studies I've seen seek to indicate whether or not giving someone free money improves their quality of life. That it does should be blindingly obvious, but that is not the question which determines whether basic income should be a political goal. That question is whether basic income is the best use of a given amount of public assistance funding. Whether it is more efficient at improving lives than alternatives such as food stamps, rent assistance, childcare assistance, etc. There seem to be no efforts to answer this essential question.

UBI might be an OK stopgap in the beginning when comparatively just a few are losing their jobs. Over time though, in the long run, the core of currency-based systems will need to be replaced as a greater percentage of labor is made valueless by AI, with the resulting increase in bodies not earning anything and decrease in bodies bearing the tax burden. I hardly see any discussion anywhere of what happens when 100% of useful labor is automated to the point that humans have 0 comparative advantage compared to AI+robots in anything of economic value.

Conceptually the flaw is treating cash as a proxy for value.

Consider the assertion “Cash is one important piece of the puzzle. The impact may be limited without other resources like health care and child care.” This is paradoxically spot-on in highlighting that money in of itself doesn’t create value, people create value for one another. Taking people out of an underperforming value stream by injecting cash is like confusing palliative and restorative care. Pain meds can keep a person limping along, and it is great as a bridge to get to a cure, but long term use has risks.

As an alternative, I would advocate for a government (or other org) facilitation of people strengthening the streams of value between themselves. This doesn’t rule out a cash distribution based on increased taxes, but would focus more on enlisting community cooperation.

One might look at wealthy people as tax cows to be milked or as people who have insights into how value is created. Instead of creating an adversarial relationship of tax avoidance, create a mutually beneficial relationship of opportunities to give and serve.

The most successful wealthy people serve large orgs in boards of directors. What if there was a similar set of local boards that guided a grant or a loan program for life transformation in the way that student loans or GI Bill works but with an explicit stipulation (as opposed to the implicit stipulation of education) of how the funding would be used to create a better life well after the funding is complete?

> "We study the causal impacts of income on a rich array of employment outcomes, leveraging an experiment in which 1,000 low-income individuals were randomized into receiving $1,000 per month unconditionally for three years, with a control group of 2,000 participants receiving $50/ month. We gather detailed survey data, administrative records, and data from a custom mobile phone app.

> "The transfer caused total individual income to fall by about $1,500/year relative to the control group, excluding the transfers. The program resulted in a 2.0 percentage point decrease in labor market participation for participants and a 1.3-1.4 hour per week reduction in labor hours, with participants’ partners reducing their hours worked by a comparable amount. The transfer generated the largest increases in time spent on leisure, as well as smaller increases in time spent in other activities such as transportation and finances."

> "Despite asking detailed questions about amenities, we find no impact on quality of employment, and our confidence intervals can rule out even small improvements. We observe no significant effects on investments in human capital, though younger participants may pursue more formal education."

> "Overall, our results suggest a moderate labor supply effect that does not appear offset by other productive activities."

https://www.nber.org/papers/w32719

Interesting to see the largest increase in consumption is "beverages". As far as I can see the commentary completely ignores this, but I presume this includes alcohol?

I think UBI without regulations on pricing will result in inflation that will negate the benefits of UBI.

Regulating prices will have unintended consequences (outside of a specific set of goods).

Perhaps the Govt needs to take over the provisioning of these basics (production and distribution) and anything outside the basics will be market driven.

I know this has been tried in the past and has failed miserably. But, we now have better ways to track these things. So, maybe time to give it another try?

It's such a small amount of money per person that it is hard to see what effects one would expect. I think for the majority of people reading hacker news $1000 per month would be barely noticeable in their bank account (obviously some people out there would notice it, but for say a lowly software dev making $150k it's not going to change much about their lifestyle). So to think it would fundamentally change someones life is a stretch. I mean it's not enough to not have to earn money (and so have the financial security to start a company or restart education) and it's not enough to purchase accommodation (especially cause it's limited to 3 years). Most I would expect is people could pay down some of their debt - so they can tread water a little easier for a few years.

Real question: What is to stop someone with power/money from taking advantage (or just fooling) someone with UBI to sign away their future UBI income? For example, the UBI person wants to buy a car, but has nothing other than UBI, the car dealer says, "no problem, just sign here and all your UBI for the next 5 years will pay for the car. Not our problem if you don't have anywhere to park it or gas to run it". Historically, those with power are able to clip a little extra assets from someone who doesn't have the power. Why wouldn't the UBI just become a new baseline for almost-zero? I hope I'm phrasing this in a way that is understandable.

UBI really makes me think of AI-safety-world i-risk. i.e. Ikigai risk (feeling like you have a meaningful purpose in life).

   Ikigai, or purpose, is a Japanese concept dating back to the Heian period in Japan. The Japanese word “iki” translates to life. Additionally, the “gai” portion of the word comes from the word “kai” meaning shell.

Beyond basic needs, Homo Sapiens in their current incarnation need some kind of meaning or purpose in life. Some folks can find this internally, other folks need to operate in an externally imposed value-structure to have meaning.

I'm not sure that UBI actually addresses this, and may be counter productive.

I'm dumb and have no real education in economics.

But even my dumb self makes the correlation that in 2020/2021, we handed out free money to keep people afloat (a very good thing), and then immediately following there was a surge in inflation.

So I guess I don't understand, how do you give out free money without devaluing the currency? Am I making an incorrect correlation between the stimulus checks and the subsequent inflation? Again, I don't know anything about this topic and I think the stimulus checks were a good idea that kept a lot of people afloat, but was that not the cause of the subsequent inflation?

The UBI folks were cursed by the pandemic and inflation. You cannot deal with that confounder.

They’re not the only ones. Remember Green New Deal? That also evaporated with the end of ZIRP.

You can complain relentlessly about these guys, or offer alternative solution with nothing but vibes to vouch for them. The truth is, as long as interest rates are high, the economic contraction is making everyone too scared to try anything in case things “get worse.” Sadly, the best time to make great social change was between 2009 and 2022 and it’s officially over now.

UBI is another tool for make citizen obedient to state. Once implemented, like debts, there will be strong voting mass for system that they could benefit from - with price of less independency.

Related: https://www.openresearchlab.org/findings

Also https://www.businessinsider.com/sam-altman-basic-income-stud... (via https://news.ycombinator.com/item?id=41037226, but we merged the comments hither)

Most people fails to understand a thing talking about basic income: it's not for those who get the money but for those who get them from those who get in the first place.

Yes, poor tend to be unable to retain money, they spend. Spending means someone else get money from them. So those with a basic income can spend more, making local economy a bit better and still making their life a bit better.

Remember a neglect thing: money are unit of measure of various substrate, not a value per se. Exchanging money means moving something else.

Many might not think about the costs of every day basic items for a minimal level of survival.

After seeing the system in use, I think it would be best if general relief type programs like you have in California, do not allow cash withdrawals. It is a factor in the ongoing fentanyl crisis. The pattern of behavior is enabled by the free cash.

Instead a debit card that can be used anywhere except for cash is ideal. While many use the money for necessary things this is a factor in what is seen in inner cities.

UBI wouldn't be needed if we got rid of loans. Loans block the increase in prosperity, as they become hard to pay if the economy improves, and misallocate resources on the bank's whim. The great depression likely wouldn't happen at all (or to a much limited extent, as some people would have to find new jobs) and instead the prices would drop until most people could live off their savings.

My feelings are that if the basic income is not enough to cover the same privilege that the older generations have of home ownership and a pension covered lifestyle (food security, housing security, medical security) then it is not basic.

And also that if it was only given to some at a sliding scale, it is not universal.

Result for higher income people is crazy. They used the additional cash to move to where they pay way more for rent and spent more on drugs to the detriment of health, child care and household spending.

It seems that more affluent are way more irresponsible with their money than poorer people.

It's interesting that the last 2 years of this study happened during a period of increasing inflation and rising interest rates. I wonder how that affected some of the metrics and qualitative surveys from the participants

I would prefer to have government-sponsored, tax-free housing for all citizens rather than UBI.

Forget Universal Basic Income, give me Universal Basic Housing.

No US citizen should be homeless, or feel like they could become homeless if they lose their job.

Interesting that saving for emergencies isn't one of the options. Having some savings would certainly reduce some stress.

Is there a link to the published research so it is easier to read through it without all these buttons to click to expand?

Other merits or demerits aside, doesn’t it seem obvious that if the state started distributing $3,600,000,000,000 of cash a year, it could possibly, just maybe, move the needle on inflation just a tiny wee bit? Has anyone ever addressed that challenge, or is it baked into the pie on purpose? If so, is this just a way to redistribute the allocation of assets? If so, why not just be honest and start the conversation there?

These discussions always devolve into political diatribes instead of a discussion of the study itself.

Is there anyone else in here that sees UBI is the "left's" equivalent to flat-earth or chemtrails? No matter how much you explain the most basic and fundamental realities that are adjacent to the laws of physics, they simply cannot or appear to be psychologically incapable of accepting the reality of the matter and are baffled.

It's like those flat-earth people who did that experiment with the extremely sensitive gyroscope that proved that the earth was rotating and spherical; and were caught on recording saying "well, we clearly cannot accept that" and I think eventually simply deliberately ignored and suppressed it from their minds.

Do not ever underestimate certain human's capacity for self-delusion.

The bigger problem though is that this UBI cult is very authoritarian and tyrannical at its core, consistently increasing the insistence that they must take and use ever increasing amounts of other people's money to prove that UBI works, coincidentally making the researchers and the common NGO types scam artist operatives huge amounts of money in the process.

UBI is simply a con job, a fraud, a lie, theft, and even slavery ... theft of resources and services against their will and under threat of violence and harm in order to support the lives and livelihoods of others.

You want UBI? Great, sign up to have your income taxed to pay for it.

It is shocking that there is no category for Investing/Saving

I was wondering for a long time, why do they reduce benefits so easily. Like if you study or do volunteer work.

It wasn't like that earlier, but at some point all the farmer families' wives applied for unemployment benefits...

Serious question, didn't we have a glimpse into UBI w/ all the stimulus packages? I'm very open to discussion here because I'm quite naive.

My current lens is that UBI ultimately inflates prices leaving everyone back where they were before. The problem with openresarchlab's test is it's limited scope. It did increase the spending power of a particular group because the prices around them did not increase.

If everyone has more money the "open market" raises prices to simply meet that. The root problem is non-limited capitalism? The price of basic goods cannot be allowed to rise vs cash on hand.

I do believe UBI's ultimate goal is to increase "spending power", but simply giving money doesn't change the problem long term and thus UBI is doomed to fail in its current form.

Well that’s one less option for when the robots take over…

The connection between UBI and Silicon Valley elite (specifically the VC class and, lately, AI people) should give everyone pause.

Why does this group of people that are not historically known for their generosity or their sympathy for the unworking poor suddenly want to give everyone a little bit of money for nothing?

In my mind, it is to create a permanent underclass. A group of people with just enough money to survive but not enough to participate in the world of the elites (or even the middle class). This underclass will represent a massive user base for the products and services that the VC class wants to sell. And they’ll be stuck there, and easier to target than ever.

There's been a narrative in the US over the last 40-or-so years that a "job" is the answer to all social problems. At best, that's half-true. Money is the real solution to social problems. And maybe it was the case 40 or 50 years ago, but having a job doesn't provide the same money that it used to, relative to required expenses.

My boomer dad got a job right out of high school, with only a diploma, and was able to purchase a house and support my then-stay-at-home mother within 3 months of starting work. That is simply unheard of now. And it's not because people don't have jobs.

How about earning your own money?

What no pay down debt option?