How is the amount of basic income determined?
March 14, 2024 8:47 PM Subscribe
I’ve read about a number of projects testing giving basic income to a limited number of people. These projects seem to vary in parameters such as how much they give, for what duration, etc. Do you know of any sources about how the specifics are determined, or what has been learned about using X amount instead of Y amount, that kind of thing? Or even a meta-study. I am especially interested in what amounts or other parameters might be the most cost effective. All the research I've seen has just been about, basically, whether it's a good idea, not what's the best way to do it.
It wasn’t universal - it was for people who lost their jobs. If you were on social assistance your income wasn’t supplemented. So not universal. But it was a good idea.
posted by somebodystrousers at 10:02 PM on March 14, 2024 [1 favorite]
posted by somebodystrousers at 10:02 PM on March 14, 2024 [1 favorite]
Best answer: Here is recent open access systematic review article discussing the effect of UBI on labor supply.
While a main goal is to determine if UBI makes people not work (no, they say), they also discuss how amount given affects what happens.
posted by SaltySalticid at 5:25 AM on March 15, 2024 [1 favorite]
While a main goal is to determine if UBI makes people not work (no, they say), they also discuss how amount given affects what happens.
posted by SaltySalticid at 5:25 AM on March 15, 2024 [1 favorite]
Canada also have universal income for seniors (65+) - you collect some combination of CPP, OAS, And GIC that equals up to almost $2,000 a month. Canada used to have an elderly person poverty issue that has pretty much been eliminated.
Canada also offers means-tested income for children under 17, there is the CTB which pays a maximum of over $7,000 a year per child that has made a dramatic difference in the rates of poverty since 2015.
posted by saucysault at 5:47 AM on March 15, 2024 [1 favorite]
Canada also offers means-tested income for children under 17, there is the CTB which pays a maximum of over $7,000 a year per child that has made a dramatic difference in the rates of poverty since 2015.
posted by saucysault at 5:47 AM on March 15, 2024 [1 favorite]
Response by poster: To clarify, I am not asking for examples of basic income being implemented, or whether it is a good idea.
I am asking about how the amount (or other specific parameters) is, was or should be determined.
posted by NotLost at 6:43 AM on March 15, 2024
I am asking about how the amount (or other specific parameters) is, was or should be determined.
posted by NotLost at 6:43 AM on March 15, 2024
Remember that there are two, fundamentally different, paradigms for basic income.
Paradigm 1 is basically a supplemental welfare program. It has all kinds of means tests, and recipients would keep all or most of their other government subsidies and protections, with the possible exception of cash grants.
Paradigm 2 is basically a substitution. A basic income is paid to every citizen, full stop, and all other poverty support / poverty amelioration programs (minimum wage laws, sometimes even civil rights laws) go away.
posted by MattD at 6:45 AM on March 15, 2024
Paradigm 1 is basically a supplemental welfare program. It has all kinds of means tests, and recipients would keep all or most of their other government subsidies and protections, with the possible exception of cash grants.
Paradigm 2 is basically a substitution. A basic income is paid to every citizen, full stop, and all other poverty support / poverty amelioration programs (minimum wage laws, sometimes even civil rights laws) go away.
posted by MattD at 6:45 AM on March 15, 2024
Response by poster: I mean "basic income" as commonly understood in "universal basic income" -- where x people get y amount of money for z time. The amount of money is standardized for a population. Nothing is taken from anyone other than maybe standard taxes. But what are the factors that go into determining the amount and other specifics? Or have any studies been done about what is the most cost-effective amount, etc.?
posted by NotLost at 7:09 AM on March 15, 2024
posted by NotLost at 7:09 AM on March 15, 2024
It's not exactly what you're looking for, but you might be interested in the work of the Joseph Rowntree Foundation on what constitutes a minimum income requirement in the UK. While it's not explicitly about UBI, it does use a society-based ground-up methodology for calculating what would be needed.
posted by plonkee at 7:42 AM on March 15, 2024 [2 favorites]
posted by plonkee at 7:42 AM on March 15, 2024 [2 favorites]
Best answer: I think most programs are limited by what funding they have available, and most would do more if they could. The idea being to establish benefit with what you have before pushing for wider rollouts of larger amounts.
I understand what you're asking. As a casual enthusiast of UBI who likes poking around Google scholar, all I have found so far is stuff that gets at your question tangentially, not directly. My guess is that this is because so few people have even been in a position to decide if they pay everyone some estimated $X necessary for survival, or $1.2*X or $0.8 *X etc. Instead, most are messing around with $X/10, trying to gain traction. Or maybe I just need to search better.
Here's some accessible research that looks into what is 'feasible' in their eyes to produce a 'large' UBI. At a glance I think it's a bit pessimistic and also maybe makes some mistakes re: labor markets assessed by my prior link, but it's something you may make progress with using forward and backward citations.
posted by SaltySalticid at 7:48 AM on March 15, 2024 [2 favorites]
I understand what you're asking. As a casual enthusiast of UBI who likes poking around Google scholar, all I have found so far is stuff that gets at your question tangentially, not directly. My guess is that this is because so few people have even been in a position to decide if they pay everyone some estimated $X necessary for survival, or $1.2*X or $0.8 *X etc. Instead, most are messing around with $X/10, trying to gain traction. Or maybe I just need to search better.
Here's some accessible research that looks into what is 'feasible' in their eyes to produce a 'large' UBI. At a glance I think it's a bit pessimistic and also maybe makes some mistakes re: labor markets assessed by my prior link, but it's something you may make progress with using forward and backward citations.
posted by SaltySalticid at 7:48 AM on March 15, 2024 [2 favorites]
Best answer: You may find your answer in Utopia for Realists by Rutger Bregman. It's a while since I read it, but it's a pretty thorough examination of basic income schemes.
posted by Enid Lareg at 8:49 AM on March 15, 2024 [2 favorites]
posted by Enid Lareg at 8:49 AM on March 15, 2024 [2 favorites]
You might be interested in how the poverty line is determined, since the amounts offered in basic income schemes tend to be around that level (though I think the USA is an exception to this, because the US poverty line is very low).
For example, in Canada the current poverty line is determined by the price of a basket of goods and services (housing, transport, food, clothes, etc). The current level for the reference family of four varies from $43-$56k per year (higher in the North). That's more or less in line with the amount that CERB offered, as mentioned above, of $2000 per month or $48k per year for a couple. Note that the poverty line was significantly lower in 2020 as there has been quite a bit of inflation since then, so $48k per year was more reasonable.
posted by ssg at 9:26 AM on March 15, 2024 [3 favorites]
For example, in Canada the current poverty line is determined by the price of a basket of goods and services (housing, transport, food, clothes, etc). The current level for the reference family of four varies from $43-$56k per year (higher in the North). That's more or less in line with the amount that CERB offered, as mentioned above, of $2000 per month or $48k per year for a couple. Note that the poverty line was significantly lower in 2020 as there has been quite a bit of inflation since then, so $48k per year was more reasonable.
posted by ssg at 9:26 AM on March 15, 2024 [3 favorites]
This journal article by an economist in Canada suggests that the market basket measure of poverty could be used (as mentioned by ssg above). It's in the section titled sufficiency. I stopped scanning there, but there might be more interesting information.
Another way to look at sufficient income, which I could see policy makers considering, is what Living Wage groups calculate, which is I believe usually higher than the official poverty line. If you google living wage for a particular city you can find what that is considered to be and probably some info about how it is measured.
posted by My Kryptonite is Worry at 3:59 PM on March 15, 2024 [1 favorite]
Another way to look at sufficient income, which I could see policy makers considering, is what Living Wage groups calculate, which is I believe usually higher than the official poverty line. If you google living wage for a particular city you can find what that is considered to be and probably some info about how it is measured.
posted by My Kryptonite is Worry at 3:59 PM on March 15, 2024 [1 favorite]
There was a UBI pilot project in Canada awhile back. I happen to receive a modest pension that almost exactly equaled that amount. I calculated it out one time and it would be enough to live on as long as I did not have to pay for housing, childcare or transportation with it. So yes, I could live in my parent's basement and walk everywhere and be able to feed and clothe myself and go out once in awhile :-) But add in daycare, bus pass and rent and I need a job.
posted by ficbot at 7:30 PM on March 15, 2024
posted by ficbot at 7:30 PM on March 15, 2024
Denver Basic Income Project has 3 cohorts at different amounts. So, obviously, one of the areas of research is what amount is most effective for a basic income program. DBIP has interim reports and is ongoing.
posted by fieldtrip at 7:51 PM on March 15, 2024 [3 favorites]
posted by fieldtrip at 7:51 PM on March 15, 2024 [3 favorites]
Response by poster: I found more research:
* https://cdn.odi.org/media/documents/11316.pdf
* https://www.givedirectly.org/cash-evidence-explorer/
posted by NotLost at 1:46 AM on March 30, 2024
* https://cdn.odi.org/media/documents/11316.pdf
* https://www.givedirectly.org/cash-evidence-explorer/
posted by NotLost at 1:46 AM on March 30, 2024
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posted by nouvelle-personne at 9:15 PM on March 14, 2024 [1 favorite]