by Kate McFarland | Aug 30, 2017 | Research
Inequality in the UK has been rising for some time as gaps between the lower and upper classes increase. But, there are movements such as levelling up the north east that are looking to reducing this inequality to ensure everyone gets good healthcare, education, job opportunities, etc. And now, the Institute for Social and Economic Research (ISER) at the University of Essex has released a paper titled “Reducing poverty and inequality through tax-benefit reform and the minimum wage: the UK as a case-study” as part of its EUROMOD working paper series.
The paper uses the EUROMOD microsimulation model to examine the impact on poverty and inequality of the proposals put forth in economist Anthony Atkinson’s most recent–and final–book Inequality: What Can Be Done? (2015). Atkinson, himself a co-author of the ISER study, passed away on January 1, during the final stages of preparation of the working paper.
The proposals considered include a “significantly more progressive income tax structure,” a “major increase in the minimum wage” (i.e. a “living wage”), and an increase in the amount of the nation’s universal child benefit, and two types of programs of social transfers: a strengthening of the UK’s social insurance system, and a “participation income”. A participation income–an idea developed and promoted by Atkinson–is similar to a basic income in that it guarantees all members of society a stable and secure livable income. It differs from a basic income, however, in that it is not fully unconditional: as its name suggests, a participation income is subject to a participation requirement. According to Atkinson, however, fulfilling this requirement should not require paid work or looking for paid work; it should also be able to be met through caregiving, community volunteer work, full-time education, or other unpaid but socially valuable activities.
In the simulation study, the authors note that “this participation condition cannot be imposed in our simulation exercise due to lack of data” and thus carry out the study “on the basis that everyone is entitled.” In other words, for the purposes of the working paper, they have chosen to simulate what is effectively an unconditional basic income.
The authors simulate a basic income at the level of £75 per week (or £3,902 per year), which replaces many means-tested programs.
One conclusion of the study is that, in comparison to strengthened social insurance (SI), the set of reforms introducing a participation income (PI) “produces a larger immediate impact on both inequality and poverty”. As the authors summarize, “[i]n achieving this greater impact the PI-focused package affects considerably more households, both positively and negatively: 43% of all households see a substantial gain and 21% a substantial loss, compared to 34% and 10% respectively with the SI-focused alternative.”
Other researchers have also recently used the EUROMOD microsimulation method to model the effects of basic income policies–including Malcolm Torry of the Citizen’s Income Trust (“A variety of indicators evaluated for two implementation methods for a Citizen’s Basic Income“) and, to more skeptical conclusions, the OECD (“Basic Income as a Policy Option: Can it add up?“).
The full working paper is free to download from ISER’s website:
Anthony B. Atkinson, Chrysa Leventi, Brian Nolan, Holly Sutherland and Iva Tasseva (June 2017) “Reducing poverty and inequality through tax-benefit reform and the minimum wage: the UK as a case-study,” EUROMOD Working Paper Series.
Reviewed by Caroline Pearce.
Photo: “The Poverty Trap…” CC BY-NC-ND 2.0 Neil Moralee (taken in Taunton, England)
by Kate McFarland | Aug 29, 2017 | Research
Ville-Veikko Pulkka, a public policy researcher and doctoral candidate at the University of Helsinki, has published his paper “A free lunch with robots – can a basic income stabilise the digital economy?” in European Review of Labour and Research.
Pulkka was previously employed as part of the research team at Kela, the Finnish Social Insurance Institution, responsible for the design and preparation of the nation’s two-year experiment replacing conditional unemployment benefits with an unconditional basic income.
The Finnish experiment has been the topic of most of his previous published work and presentations related to basic income (including presentations at conferences in Switzerland, Poland, Finland, and Ireland).
Pulkka’s research at the University of Helsinki, including his doctoral dissertation, centers on the implications of the digital economy for labor and public policy.
“A free lunch with robots,” his latest publication on basic income, moves away from focus on the Finnish experiment to explore the latter topic in more general terms:
The discussion on the possible implications of the digital economy for labour continues unabated. An essential dimension of the discussion is the widely shared view that a basic income could guarantee sufficient purchasing power for unemployed, underemployed and precarious workers should technological unemployment and labour market insecurity increase. A budget-neutral basic income has serious limitations as an economic stabilisation grant, but if financing proposals are revised, these limitations can be tackled. Even though guaranteeing sufficient purchasing power for unemployed, underemployed and precarious workers does not necessarily require an unconditional universal benefit, it seems clear that traditional activation based on strict means-testing and obligations will not be a strategy flexible enough to guarantee sufficient consumer demand in fluctuating labour markets. An economically sustainable solution might be to reduce means-testing gradually and to study carefully the effects.
The full article is available behind a paywall here.
Reviewed by Russell Ingram.
Photo CC BY-NC 2.0 Helen Taylor
by Dave Clegg | Aug 21, 2017 | Research
This paper represents a massive undertaking by both University of Melbourne Australia faculty and an independent agency called the the Brotherhood of St. Laurence dedicated to social Justice. It looks at a collection of BI pilot projects, as well as other projects which can be considered close approximations of a BI, from around the world. Government projects which have been run in the past as well as private and government projects currently being implemented.
The paper provides a number of graphs and and analyses aimed at comparing and contrasting the examined projects while underlining the incredible number of variables affecting both the design and the outcome of any such project that must be attended to. But the main focus of this paper is to determine how a BI can ensure equity of income, improved efficiency of governance and an end to the stigma of social supports.
While considering the concept of a BI to be attractive for a host of reasons, not the least of which are equity and the automation of the workplace, the paper is decidedly cautious and suggests careful consideration of “… broader issues and the intersecting domains and policies” which one can only assume refers to the social and economic ramifications of such a project. A very bureaucratic summation of some extremely crucial social concerns.
by Kate McFarland | Aug 19, 2017 | Research
Three members of the Foundation for European Progressive Studies (FEPS) Young Academic Network — Frederick Harry Pitts, Lorena Lombardozzi, and Neil Warner — have published a study on basic income, entitled “Beyond Basic Income: Overcoming the Crisis of Social Democracy?”
The full paper can be read and downloaded here.
Abstract
Across Europe, a crisis of social democracy prevails. Deindustrialisation precipitates a breakdown of the communities, institutions and interests that held the social democratic and labour movements together. A collapse in everyday life passes over into a steady decline in the electoral realm. Elsewhere, a crisis of social reproduction ensues. The relationship between the wage and subsistence weakens, public services face cutbacks and a generalised dispossession of people from the commons continues apace. This triple crisis- of the society of work, social reproduction and social democracy- is a triple crisis of the social. The universal basic income (UBI) is suggested by many as a means by which the social synthesis can be pieced back together.
In this paper we explore whether or not UBI lives up to the claims made for its implementation, and to what extent it addresses these three crises. We ultimately pose the question whether UBI offers a solution to the crisis of social democracy, and whether, on this basis, European social democrats should pursue the policy as a central demand of a new electoral offer. We conclude that the policy cannot be suggested as a solution to the crises of work and social reproduction, at least not without being complemented by a range of other measures. A suite of reforms could strengthen its impact and ensure it is used to nurture and preserve positive social relations that reflect social democratic ideas, rather than contrary outcomes implied in alternative visions of the UBI proposed from both right and left of the political spectrum.
About the Authors
Frederick Harry Pitts holds a PhD from the Department of Social and Policy Sciences at the University of Bath, and is currently a Lecturer in Management at the University of Bristol. His research interests lie in the sociology of work and political economics, with specializations in the creative industries and the future of work.
Lorena Lombardozzi is a graduate student at SOAS University of London, where she holds an MSc in Political Economy of Development. Her dissertation research concerns agricultural commercialization in Uzbekistan’s cotton-food system and its nutritional impacts.
Neil Warner is a postgraduate researcher in the Department of History at Trinity College Dublin, studying perspectives on unemployment and the British Labour Party in the late 20th century.
FEPS is the first progressive think tank to operate at a European level. It has previously supported discussion of universal basic income, convening a panel discussion on the topic in Brussels in February 2016 as part of its Next Social Europe lunch debate series.
The FEPS Young Academics Network, established in March 2009, currently consists of over 50 PhD candidates and recent PhD recipients from a range of disciplines.
Photo: “Unemployment Wall” CC BY-NC-ND 2.0 Luis Colás
by Peter Vandevanter | Aug 3, 2017 | Research
Louise Haagh
Louise Haagh, an associate professor at the University of York and chair of the Basic Income Earth Network (BIEN), argues in the June Nature that the reform is making inroads internationally today.
Nature is one of the world’s top academic journals, claiming an online readership of about 3 million unique readers per month.
At the same time, Haagh says basic income is a pivoting argument, because it helps discussions that bring about changes in individual and public policy. She also argues that basic income should not be viewed in moral terms as a compensation for economic insecurity, that such a moralistic interpretation does not do full justice to the claim that “security is important because it enhances people’s sense of control over their lives”.
At the end of 2016, the year in which BIEN celebrated the 30th anniversary of its birth, Haagh, as a life member, reflected on her own personal journey with the network:
“Basic income appealed to me then primarily as a necessary foundation for consolidating workers’ rights – and in many ways that is still how I see it, but in a broader context of rights to human development… Against this background I was struck by the sanity – the immediately obvious justification for basic income. It seemed to me evident that the most important justification was a basic humanist and democratic one – and I still think that today.”
In the Nature article, Haagh says basic income is a pivoting reform, in two ways, that together may be more important than ever:
“First, it is pivoting in relation to freedom extension because it helps to rebuild individuals’ pivot positions, through re-enabling greater differentiation between different core forms of security. Second, basic income is potentially pivoting for other institutions’ development; it creates a monetary basis and rationale for building new risk-sharing mechanisms and institutions between individuals directly and through public policy.”
More information at:
Louise Haagh, “Basic Income as a pivoting reform“, Nature, June 2017 Vol 1 Article 125
by Andre Coelho | Jul 13, 2017 | Research
Malcolm Torry. Credit to: The Back Road Café
In a partnership between the Citizen’s Income Trust and the London School of Economics, Malcolm Torry, Director of the Citizen’s Income Trust and General Manager of BIEN, authors and presents a new study on the implementation of a basic income in the UK.
This study, referred to as a working paper, details two potential implementation models for a basic income, and looks into their consequences with respect to several social and economic indicators, including “poverty and inequality indices, tax rate rises required for revenue neutrality, household disposable income gains and losses, household’s abilities to escape from means-testing, and marginal deduction rates.”
The implementation models examined were, first, a basic income to all UK citizens, funded by the existing tax and benefits system, which would maintain the means test but introduce new thresholds and, second, a program that would be phased in by increasing the UK’s Child Benefit and allowing all new sixteen-year-olds to keep that benefit for life.
According to Malcom’s analysis, both models are feasible and beneficial in terms of the above indicators. Notably, estimated losses would be insignificant to households in the lowest quintile, and still relatively insignificant when considering all households. Additionally, in both cases, income tax rates would not need to be raised more than 3% in order to finance the basic income scheme roll-out.
More information at:
Malcolm Torry, “A variety of indicators evaluated for two implementation methods for a Citizen’s Basic Income”, Euromod Working Paper Series, May 2017
