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Overview of Current Basic Income Related Experiments (October 2017)

by Kate McFarland | Oct 19, 2017 | News

Existing and Upcoming BI-Related Experiments

By Kate McFarland

Last updated: October 15, 2017

It seems that 2017 has been a watershed year for the global basic income movement, as multiple governments and private research groups have independently conceived and launched experimental trials of basic income (and closely related policies). Several new experiments in North America and Europe represent the first such experiments in the developed world since the 1970s (when a negative income tax was tested in several cities in the United States and Canada), and the largest basic income trial ever designed is about to take place in Kenya.

At the same time, rumors of other experiments have appeared only to be revealed to have been premature, and sloppy and superficial media reports have obfuscated differences in the design and motivation of these disparate studies. This article reviews the latest information (as of October 2017) on the experiments that actually are being conducted (or well along the path) [1] [2].

The federal government of Finland is currently conducting an experiment of the effects of a basic income on unemployed citizens, which began in January 2017 and will conclude in December 2018. Prior to the launch of the Finnish experiment, the provincial government of Ontario had already announced its plans to test a type of unconditional income guarantee; at the time of this writing, it is currently enrolling participants in three areas of the province, who will receive an income guarantee for up to three years. In the Netherlands, another instigator of the recent interest in basic income experiments, municipal-level experiments have faced setbacks and changes in the quest to meet compliance with federal law; however, as of October, several cities have now launched experiments with the removal of conditions on social assistance benefits. The city of Barcelona has launched an experiment testing several potential reforms of its anti-poverty programs, including new social programs as well as unconditional cash payments. Proposals to test basic income at the municipal level have also lately gained considerable political support in Scotland.

In addition, two US-based non-profit organizations have completed pilot studies, and are preparing to launch privately funded basic income experiments on a large scale. After the Kenyan elections, the charity GiveDirectly plans to initiate a 12-year randomized controlled trial (RCT) testing the effects of universal basic income on villages in rural Kenya. Meanwhile, Silicon Valley’s Y Combinator Research has completed a feasibility study in Oakland, California, and is now finalizing the design of an RCT that is to involved 3,000 participants in two US states. (Edit: A privately funded trial in Stockton, California–announced around the same time this article was published–may soon join the list. However, the project is in its early planning stages, and few details have yet been determined.)

1. Finland’s “Perustulokokeilu” (Basic Income Experiment)

Status: Launched on January 1, 2017; in progress until December 2018.

Official website: https://www.kela.fi/web/en/basic-income-experiment-2017-2018

In October 2015, the federal government of Finland formed a working group to research the design and implementation of a nationwide basic income experiment, described as a means to “find ways to reshape the social security system in response to changes in the labor market”.

One prevailing concern with existing systems of social security was the steep rate at which benefits are clawed back when beneficiaries receive a job, which has been hypothesized to discourage job-seeking. Additionally, those who gain employment on a short-term basis need to reapply for benefits after their position ends, often resulting in a gap in financial support. The latter has become a particular concern due to the increase in precarious work, such as temporary and contract positions (see, e.g., Marjukka Turunen’s presentation to Kela). Thus, the idea of unconditional basic income gained attention as a possible means to remove practical and psychological barriers that might currently deter unemployed Finns from looking for work.

“Finland!” CC BY 2.0 Dave_S.

After reviewing several design suggestions proposed by Kela, the Social Insurance Institution of Finland, the government settled on the program that was launched on January 1, 2017. The experimental group consists of 2,000 persons, who were randomly selected from Finns between the ages of 25 and 58 who had been receiving unemployment benefits from Kela in November 2016. (The remainder of the sample population, totaling around 175,000 individuals nationwide, constitutes the control group.)

These 2,000 participants are receiving unconditional monthly cash payments of €560 (about 590 USD), an amount insufficient to meet basic living expenses, but approximately equal to that provided by Finland’s existing programs of unemployment assistance.

In contrast to those who continue to receive Kela’s existing unemployment benefits, participants in the basic income pilot are not required to demonstrate that they are seeking employment, nor are they required to accept jobs offered to them, and those who do obtain work will continue to receive the full benefit.

The first payouts to experimental participants were distributed on January 9, 2016, and payments will continue through the end of the trial in December 2018. To avoid selection bias, participation was mandated for those chosen, and exit from the experiment is prohibited. However, the experiment has been designed to ensure that no participants will be placed in a worse financial position than they would have experienced under their previous benefits.

Labor supply effects are the main outcome of interest: the experiment will assess whether the final unemployment rates differ significantly between those individuals receiving the basic income and those receiving traditional employment benefits. Kela has also stated plans to examine difference in expenditure on medication, health care usage, and income variation.

To avoid observer effects, Kela aims to minimize interaction with experimental subjects during the duration of the trial, and will conduct no surveys or interviews of subjects until the experiment has concluded. Most analysis will be based on registry data that can be obtained without direct interaction with participants. No results of the experiment will be released prior to 2019, after the period of data collection has concluded. (Rumors of early results demonstrating a decrease in stress level were, in fact, based on a single anecdote voluntarily divulged to media.)

While many basic income supporters and “BI-curious” individuals have praised Finland’s initiative launching the first nationwide experiment of a basic income program, many activists have also expressed disappointment with the final design of the experiment, questioning its ability to produce useful results and even whether it should be called a “basic income” at all [3]. Particularly controversial have been the decisions to test only a “partial” basic income (i.e. an amount insufficient to meet basic living expenses), limit the target population to those who had previously been receiving unemployment benefits, and focus primarily on labor supply effects.

Research director Olli Kangas has recommended expansion of the experiment in future years in order to test different models of a basic income or broaden the target population. This, however, will depend on budgetary decisions of the federal government.

2. Ontario’s Basic Income (Guaranteed Minimum Income) Pilot

Status: Officially announced in April 2017; currently enrolling participants.

Official website: www.ontario.ca/page/ontario-basic-income-pilot

Before describing Ontario’s “Basic Income Pilot” (as the study is officially called) on BIEN’s website, a word about terminology is in order: in the Canadian context, the term ‘basic income’ is commonly used in a more expansive manner than the definition adopted by BIEN to refer to programs that guarantee minimum income, with no type of work requirement, for all members of society without any type of work conditions. This is more expansive that BIEN’s definition in that it omits the conditions that policy must provide payments to individuals (rather than households) and in an amount not dependent on additional earned income.

For example, Canadian writers and policymakers often use ‘basic income’ to refer to programs in which cash payments are not distributed universally, such as a negative income tax or top-up of low incomes. (In common Canadian terminology, the word ‘demogrant’ is used equivalently to BIEN’s use of ‘basic income’, and to refer to a sub-type of the programs that most Canadians call ‘basic income’.)

River in Lindsay, Ontario, CC BY 2.0 RichardBH

This clarification is important given that, in fact, Ontario’s experiment employs cash transfers that depend in their amount on both income and household status. Specifically, single participants will receive a guaranteed annual income of 16,989 CAD (€11,340), while couples will receive a minimum of 24,027 CAD (€16,038) per year (amounts pegged to 75% of the Low Income Measure or LIM, where the LIM is roughly 50% of area median income).

Moreover, the above amounts are the maximum payments; that is, they are the amounts that would be paid out to individuals and couples with no external income source. The amount of the benefit will be reduced by the amount of 50% of any earned income (e.g. if a single individual in the study receives 20,000 CAD per year in earned income, she will receive an additional 6,989 CAD per year through the pilot program, or 16,989 CAD less 10,000 CAD). This entails, for example, that single individuals will not receive any payment through program if their annual earned income rises above 48,054 CAD.

Additionally, only Ontarians with an annual income below a certain level (34,000 CAD for single individuals or 48,000 CAD for couples) are eligible to participate in the experiment. (In contrast to the experiments in Finland, the Netherlands, and Barcelona, the target population is not restricted to current welfare recipients; it is, however, restricted to the low-income population.)

Although the amount of the cash supplement depends on income and household status, it does not depend on employment status, participation in job-seeking activities, training, or any other prescribed activity, or proof of an inability to work (although individuals with disabilities can receive an additional amount of up to 500 CAD per month).

Compared to the Finnish government, the government of Ontario is less focused on employment effects in particular, and more interested in the ability of a guaranteed income program to reduce poverty, food insecurity, and mental and physical health problems caused or exacerbated by low or unstable income. This is one reason that, in the context of the Ontario experiment, it may be less significant that the cash benefit is clawed back with earned income; researchers and policymakers are less focused, if at all, on reducing or removing the “benefits cliff”. Meanwhile, poverty–the prevailing concern to Ontario–is not an issue motivating the trial in Finland.

Thunder Bay lighthouse, CC BY-NC 2.0 C Hanchey

Since June 2017, the Ontario government has been enrolling participants from the three regions chosen as sites for the experiment: the Hamilton, Brantford, and Brant County region, Thunder Bay and surrounding area, and the city of Lindsay.

Residents of these regions have been randomly selected to receive application packages, and are eligible to enroll if they are between the ages of 18 and 64 with income below the levels mentioned above. Unlike the situation in Finland, participation is voluntary, and participants may opt out of the experiment at any time.

At the time of this writing, 400 participants have been enrolled from Hamilton and Thunder Bay areas. The government intends to enroll at total of 2,000 participants from these two regions, in addition to 2,000 from Lindsay (where enrollment will begin later in the year).

Participants will be regularly surveyed about topics such as their health, employment, and housing situation. Those assigned to the control group will receive no cash benefit but will be administered the same surveys. A third-party research group will evaluate outcomes in a variety of areas, including food security, stress and anxiety, mental health, health and healthcare usage, housing stability, education and training, and employment and labor market participation.

The experiment will continue for three years after its launch, with payments distributed on a monthly basis, and results are expected to be reported to the public in 2020.

3. Dutch Social Assistance Experiments

Status: Two-year experiments have been launched in four cities in October 2017, after meeting compliance with federal legislation; a fifth will follow in December (Nijmegen), and two cities (Amsterdam and Utrecht) are discussing revisions necessary for legal compliance.

In contrast to the cases in Finland and Ontario, in which the national and provincial governments (respectively) have called for and overseen the implementation of the trial programs, social assistance experiments in the Netherlands have developed “from the bottom up”: municipal leaders and university researchers in several Dutch cities planned experiments to test the replacement of the nation’s “workfare” benefits with unconditional cash assistance, and sought permission to carry out these experiments under the auspices of the Participation Act.

This national law, passed in 2015, tightened conditions on the receipt of welfare benefits, with the goal of promoting reintegration into the labor market. For example, individuals are commonly required to complete five job applications per week, attend group meetings, and participate in training activities in order to continue to receive their benefits. However, the law also granted municipalities the opportunity to implement new forms of social assistance on a trial basis for up to two years–subject to certain constraints (to be discussed below). Hence, the Participation Act might be said to have provided both the impetus to experiment with basic income (as an alternative to its workfare-based to benefits) as well as the license to do. As will be seen, however, the conditions of this legislation have also effectively precluded the ability of researchers to test a truly unconditional and non-means-tested basic income.

The Dutch municipal experiments, like the Finnish experiment, were motivated in large part by concern about the ability of existing welfare programs to incentivize work. However, while the Finnish experiment focuses on the role of monetary incentives (e.g. the ability to retain cash benefits after taking a job), the Dutch experiments have also stressed individuals’ intrinsic motivation to work. For example, drawing upon work in behavioral economics, Utrecht University economists Loek Groot and Timo Verlaat have argued that coercing individuals to work, as in the case of the nation’s “workfare” programs, can undermine their intrinsic motivation to perform fulfilling work and make productive contributions to society.

Thus, although the Dutch municipal experiments are designed to investigate the effect of removing financial disincentives to work (reducing the withdrawal rate on means-tested benefits), as described below, the most discussed experimental intervention has been the removal of coercive reintegration requirements on welfare recipients.

Nijmegen train, CC BY 2.0 Rob Dammers

Researchers at the Universities of Groningen, Tilburg, and Utrecht initially proposed to test a policy close to a basic income. However, research teams experienced setbacks in 2016 and 2017, as interaction with the national Ministry of Social Affairs and Employment made clear that the terms of compliance with the Participation Act would prohibit experimentation with a truly unconditional benefit.

For example, if an experiment involves the removal of work reintegration requirements on benefits, the Ministry mandates that municipal officials survey test subjects after six and twelve months to verify that they have made adequate effort to find employment: if any participants are determined not to have made adequate job-seeking efforts during this time, they are subject to dismissal from the experiment. The Ministry has also required that any experiment including a treatment group with relaxed conditions on the receipt of benefits also must include a treatment group with stricter conditions (such as more intense reintegration activities). Finally, the Participation Act caps the amount of earned income that participants are permitted to retain on top of their social assistance benefits at €199 per month, meaning that a completely non-withdrawable (non-means-tested) benefit cannot be tested.

Despite such setbacks and constraints, however, several municipalities have designed–and are beginning to launch–experiments that meet the conditions of the Participation Act.

On July 3, 2017, the Dutch Ministry of Social Affairs and Employment granted permission to four municipal-level social assistance experiments–in Groningen (with the neighboring village of Ten Boer), Wageningen, Tilburg, and Deventer. An application from Nijmegen was also approved shortly thereafter. Meanwhile, discussions are ongoing in Amsterdam, where the city has so far refused to adopt the stricter conditions required by the Participation Act, and Utrecht, where an application to experiment was approved conditionally on revising a city law to meet compliance with the act (to be decided in December).

Deventer, CC BY-NC 2.0 Jens-Olaf Walter

In each of the two-year experiments, participants will be (or have been) randomly selected from a pool of current social assistance beneficiaries, and assigned either to a control group or to one of several treatment groups.

As in Ontario’s experiment, but in contrast to Finland’s, participation is voluntary for those selected.

The experiments in Tilburg and Wageningen include three treatment groups: (1) a group with the removal of reintegration requirements, such as job application quotas and participation in training programs, on welfare benefits; (2) a group with a more intensive form of reintegration service for welfare recipients (as per the requirements of the Participation Act); (3) a group permitted to keep additional income earned on top of welfare benefits (subjects in this group may retain 50% of additional earned income, up to the mandated maximum of €199 per month, for the duration of the two-year experiment; under current policy, welfare beneficiaries are permitted to keep only 25% of additional income, and only for up to six months).

The Groningen / Ten Boer experiment includes a fourth treatment group, in which participants are permitted to choose to join any one of the three preceding groups.

The Nijmegen experiment, in contrast, will combine features of above treatment groups into two group. In one group, reintegration requirements will be removed; in the other, more intensive reintegration requirements will be implemented, but subjects will be allowed more autonomy and discretion in selecting reintegration activities (e.g. volunteer work, help obtain full-time work, or assistance for entrepreneurship). In both, subjects will be able to retain of 50% of additional income (up to the €199 maximum).

Researchers plan to examine outcomes such as health, stress level, subjective well-being, financial well-being (such as amount of debt), education, employment (including part-time and temporary employment), and participation in social and cultural life.

The experiments in Tilburg, Wageningen, and Deventer began at the start of October 2017, with Groningen / Ten Boer to follow at the end of the month. Nijmegen plans to launch its experiment in December.

4. Barcelona’s B-MINCOME

Status: Launched in October 2017

Official website: https://ajuntament.barcelona.cat/bmincome/

Launched in October 2017, Barcelona’s B-MINCOME experiment is exploring several potential solutions to address poverty and social exclusion. The experiment is being conducted in Besòs area, the city’s poorest region, and, as in the above experiments, the target population consists of low-income individuals and households. As in the Finnish experiment and Dutch municipal experiments, participants are drawn from current recipients of social assistance benefits (in this case, Barcelona’s Municipal Social Services). Once again, although the program is thereby not a test of a truly “universal” benefit, this restriction is sensible in the context of the experiment, the main objective of which is to test the effectiveness of alternative anti-poverty programs.

“Panorama sobre el Besòs” CC BY-SA 2.0 Jordi Domènech i Arnau

A stratified random sample of 2,000 households was selected for the experiment, with 1,000 households assigned to the control group, and the other 1,000 assigned (at random) to one of ten treatment groups. (As in the Ontarian and Dutch experiments, but in contrast to the Finnish experiment, participation in the experiment was made voluntary for the selected households.)

All of the treatment groups will receive cash income supplements (called “Municipal Inclusion Support” or, in the Spanish acronym, “SMI”), but differ according to whether the SMI is accompanied by an additional social program and whether the SMI is means-tested. In general, the amount of the SMI will depend upon household composition and financial status, and is expected to range from €100 to €1,676 per month per household. A total of 550 households in the experiment will be assigned to participate in one of these four social programs, including an occupation and education program, a social and cooperative economy program, a guaranteed housing program, and a community participation program. The remaining 450 households will receive the SMI without any associated programs. Within this group, the receipt of the SMI is not conditional on work, willingness to work, or willingness to participate in any other type of program. Furthermore, for some of these 450 households, the SMI will not be means-tested.

Hence, although B-MINCOME is not only a test of basic income–it is also a test of the effectiveness of the additional social programs–it includes a trial of basic income. This is not coincidental: the project team contains several members of BIEN’s Spanish affiliate, Red Renta Básica, and consulted with representatives from Finland, Ontario, and Utrecht who have been involved with the design of the experiments in their respective regions (not to mention that its name refers to Manitoba’s well-known experiment with unconditional income guarantee, in the form of a negative income tax, in the 1970s).

To examine the impact of the cash transfers (SMI) and social program on poverty and social exclusion, researchers will examine a number of outcome variables, including labor market participation, food security, housing security, energy access, economic situation, education participation and attainment, community networks and participation, and health, happiness, and well-being. They will additionally investigate the question of whether the SMI reduces the administrative and bureaucratic responsibilities of social workers.

B-MINCOME is being administered by the Barcelona City Council, with consultation from five research organizations (the Young Foundation, the Institute of Governance and Public Policy at the Autonomous University of Barcelona, the Polytechnic University of Catalonia, the Catalan Institution for Evaluation of Public Policies, and NOVACT-International Institute for Non-Violent Action), and was awarded financial support by Urban Innovative Actions, an initiative of the European Commission formed to support projects investigating “innovative and creative solutions” in urban areas.

The leading political party in the City Council, the left-wing Barcelona en Comú, has expressed interest in implementing a municipal cash transfer program if results of the experiment prove favorable.

5. GiveDirectly’s Basic Income Experiment in Kenya

Status: Full experiment (consisting of 300 rural villages) planned to launch after the Kenyan election on October 26, 2017; pilot study running in one village since October 2016. [Update: Official launch occurred in November 2017.]

Official website: www.givedirectly.org/basic-income.

GiveDirectly, a US-based charitable organization, has been providing unconditional cash transfers to poor residents of Kenya and Uganda since 2009, when it was founded by a team of economists who had become interested in the hypothesis that cash transfers are the most effective means to combat extreme poverty. Since this time, its practice of delivering cash grants directly to those in need has proven efficient and effective, earning the organization recognition as one of GiveWell’s top charities.

In 2016, GiveDirectly announced a new ambition: the first long-term and large-scale randomized controlled trial (RCT) of universal basic income. The experiment will provide unconditional cash transfers to the residents of 120 villages, comprising more than 16,000 people in total, with some receiving payments for up to 12 years. This makes the experiment the largest of its type, in terms of the number of individuals who will receive assistance, as well as the longest in duration [4]. The cost of the experiment will amount to $3o million, most of which has been now raised by private donors.

Rural Kenya, CC BY-NC 2.0 ViktorDobai

In contrast to all experiments taking place in developed nations, GiveDirectly’s experiment examines the impact of programs that are indeed universal–that is, in which the unconditional cash transfers are distributed to all individuals residing in the villages where the program will be implemented [5].

Indeed, the experiment is designed as an RCT in which villages (not individuals or households) are the experimental units: 300 villages in rural Kenya will be randomly assigned to either the control group (comprising 100 villages), in which no cash transfers are given to any residents, or one of three treatment groups, in which all residents receive some form of unconditional cash transfer. In the first treatment group (comprising 40 villages), residents will receive cash payments of about 23 USD (€21)–roughly half of the average income in rural Kenya–every month for 12 years. In the second treatment group (80 villages), residents will receive monthly cash payments of the same amount, but only for two years. In the third treatment group, residents will receive a single lump-sum payment equal in amount to the two-year basic income (that is, about 276 USD).

As GiveDirectly explains on its website, “Comparing the first and second groups of villages will shed light on how important the guarantee of future transfers is for outcomes today (e.g. taking a risk like starting a business). The comparison between the second and third groups will let us understand how breaking up a given amount of money affects its impact.”

The organization further indicates that it will investigate outcomes including the following: “economic status (income, assets, standard of living), time use (work, education, leisure, community involvement), risk-taking (migrating, starting businesses), gender relations (especially female empowerment), [and] aspirations and outlook on life.”

GiveDirectly had initially planned to launch the experiment in September 2017, but has postponed the launch to after the Kenyan elections on October 26.

An initial pilot study commenced in one village in October 2016, in which all 95 residents now receive monthly unconditional cash payments, which will continue in this village for 12 years. This preliminary study is intended to help experiments fine-tune the implementation of the full experiment, and is not itself to be included in the analysis of the full experiment. Because of this, GiveDirectly is making public much of its data that is collects from the pilot village (e.g. responses to a survey of participants). (It will not, however, publicize data as it is collected from villages that are part of the experiment.)

GiveDirectly expects to publish its first results one or two years after the experiment’s commencement.

6. Y Combinator’s plans for a United States experiment

Status: Completed feasibility study in Oakland; issued draft of research plan for randomized experiment (3,000 participants in total) in two US states.

Official website: https://basicincome.ycr.org/

In January 2016, Silicon Valley entrepreneur Sam Altman (president of the start-up incubator Y Combinator) announced his intention to fund a test of basic income in the United States. Like many tech entrepreneurs, Altman cited concerns about job loss due to automation in explaining his interest in basic income: “I’m fairly confident that at some point in the future, as technology continues to eliminate traditional jobs and massive new wealth gets created, we’re going to see some version of this at a national scale.” The experiment is now the main project of the non-profit arm of Altman’s company, YC Research.

Since the initial announcement, YC Research has hired social work and political science PhD Elizabeth Rhodes as Research Director and assembled a team of expert advisors. This research team has designed and implemented a feasibility study in Oakland, California [6], and is now working to finalize the design of its full-scale experiment.

CC BY-SA 2.0 Bill So

According to a project proposal released in September 2017, Y Combinator has decided to design the experiment as a randomized controlled trial, with a target population of low-income young adults–specifically, adults aged 21 to 40 whose incomes fall below the area median–in two US states. (Researchers will employ a stratified sample to ensure adequate representation across race, gender, and income categories.)

On the tentative design, researchers will select a total of 3,000 participants, of which 1,000 will be randomly assigned to the treatment group–whose members will receive unconditional cash payments of 1,000 USD per month–and the remaining 2,000 to the control group. (Individuals in the control group will provide the same type of feedback and data to researchers but receive only a much smaller cash payment, tentatively set at 50 USD per month, for their participation.) As currently planned, some individuals will receive the cash payments for three years, others for five.

Y Combinator emphasizes that its interest is a “holistic approach to understanding the individual-level effects of basic income”, in contrast to many past and present experiments which have focused on the labor market impacts of unconditional cash payments (such as Finland’s experiment and the negative income tax experiments conducted in the US in the 1970s). Among these individual-level effects, the research group is particularly interested in time use, mental and physical health, subjective well-being, financial health, decision making and attitudes toward risk, as well as political and social attitudes. Furthermore, although individual-level effects will be the focus of the experiment, researchers also hope to examine spillover effects on recipients’ families, friends, and communities.

While the research group has not finalized its choice of data sources and collection methods (see its project proposal for a discussion of possibilities currently under discussion), it plans to combine quantitative analysis with regular surveys and interviews. However, according to Rhodes, receipt of the cash payments will not be contingent on participation in surveys and interviews; payments will continue for the duration of the experiments even if recipients do not respond to requests for data and information.

To conduct the experiment, YC Research has partnered with the Center on Poverty and Inequality (CPI) at Stanford University. The research has been approved by Stanford’s Institutional Review Board for research involving human subjects. YC Research is also in the process of working with state and local governments to coordinate mechanisms for distributing payments without affecting recipients’ future eligibility for existing government benefits.

No specific launch date has been set for the experiment, as YC Research is still gathering feedback on its project proposal. However, at a plenary lecture at the 2017 BIEN Congress, Rhodes indicated that the research group hopes to commence the trial in early 2018.

7. Scotland’s plans for local experiments

Status: Government support pledged; preliminary reports in progress.

In November 2016, the Councils of Fife and Glasgow committed to investigate the feasibility of municipal-level basic income experiments. An important step forward occurred in February 2017, when the Glasgow City Council passed as a resolution to convene workshops on the financial, administrative, and constitutional feasibility of an experiment, partnering with the Royal Society of Arts (RSA), a British think tank responsible for a highly regarded report on potential for a basic income in the UK (“Creative Citizen, Creative State”).

Fife and Glasgow were later joined in their interest by North Ayrshire and Edinburgh.

In September 2017, the Scottish government announced its commitment to provide funding and support for basic income experiments in the four municipalities (see the RSA’s announcement), and RSA Scotland is now working with the government to prepare an initial report on the possibilities for an experiment in Glasgow.

No design decisions or prospective launch dates have yet been announced.

In general, the RSA and local authorities are attracted to basic income as a potential means to address poverty, precarious employment, economic insecurity, and the changing nature of work.

Scottish Highlands, CC BY-NC-ND 2.0 Peter Coughlan

Notes
[1] The coverage of the present article is limited to projects that qualify as experiments in a social scientific sense. Thus, it does not include several projects that are sometimes listed–incorrectly–as “experiments” of basic income. Missing, for example, are lottery programs like Mein Grundeinkommen, as well as any pilot studies that lack a control group, such as the ReCitivas Institute’s pilot in Quatinga Velho and Eight’s two-year pilot study in Uganda (see “Some thoughts on basic income ‘experiments’” by Michael A Lewis).

Programs and policies such as Iran’s fuel subsidy reform and Alaska’s Permanent Fund Dividend are occasionally misconstrued in sentences like “Iran and Alaska have tested basic income”. These programs are also not experiments in the scientific sense, and thus omitted from inclusion in this article.

[2] Of course, no experiment can fully test the effects of a basic income, which, by definition, would guarantee cash stipends to all individuals in a community, and it would guarantee this support for life. Experiments, in contrast, are bound by their nature to be non-universal (since there must be a control group) and limited in duration. Furthermore, it is likely that additional changes to the taxation of benefit system, which are not captured in the experiments, would accompany the introduction of a basic income.

(In a forthcoming article, I will argue that, in the case of my own interest in basic income as a possible stimulus to long-term cultural change, the above facts preclude limited trials from having the capacity to produce usefully informative results.)

[3] According to many definitions, including those adopted by some of BIEN’s affiliates (although not BIEN itself), a “basic income” is a recurring payment sufficient to meet basic living expenses. On these definitions, it is indeed inaccurate to call describe the Finnish experiment a “basic income experiment” given €560 per month falls below average minimum monthly living expenses in Finland (although it might plausibly be called, as Kela sometimes more precisely describes it, a “partial basic income experiment”).

One may also raise concern regarding the universality of the program–or, rather, the lack thereof–given that a sample of adult recipients of unemployment benefits is clearly not representative of all Finns, and no “true” basic income (on any definition) would not be restricted only to the unemployed. One might alternatively say, however, that the Finnish experiment is indeed a test of a (partial) basic income, albeit one using a non-representative sample.

[4] In 2016, the Brazilian non-profit institute ReCivitas initiated a project, Basic Income Startup, which promises a “lifetime basic income” of 40 Reais (about 10 USD) per month to members of the village Quatinga Velho. The project targets volunteer recipients in areas where 40 Reais per month makes a significant impact on quality of life.

ReCivitas’s Basic Income Startup, however, is not an experiment (although occasionally miscategorized as one). Indeed, project founders have stated that they are already convinced that basic income is effective; their goal is not to test but to implement it.

[5] Previous trials of basic income and related policies have used saturation sites. Notably, Manitoba’s MINCOME experiments of the 1970s, which tested a type of minimum income guarantee in the form of a negative income tax, featured a saturation site in the town of the Dauphin.

The basic income experiment in Madhya Pradesh was also a saturation studym in which all members of the nine villages in the experimental group received monthly unconditional cash transfers (equal about one quarter of the median income in the state).

[6] Contrary to some misconceptions, the Oakland project was not itself an experiment. Its purpose was merely to test and fine-tune the mechanisms for conducting the experiment–such as the selection of participants, disbursement of funds, and collection of data–not to analyze the effects of unconditional cash transfers on recipients. The latter will be the goal of the project described in a newly released research proposal, and which has yet to be finalized and launched.

Addendum on Stockton, California (October 20, 2017)

Only a few days after this updated article was published, Michael Tubbs, Mayor of Stockton, California, announced his intention to carry out a pilot of basic income or guaranteed income in his city, the Stockton Economic Empowerment Demonstration (SEED).

The project will be privately funded, and has already received a $1 million SEED grant (if you will) from the Economic Security Project, a two-year initiative launched in December 2016 to fund basic income related projects in the United States.

At present, however, few details have been announced or decided.

According to its website, the project is “in the very early stages of development”.

Regarding the current state of the project, the site notes:

We will kick off the demonstration with a six-nine month design period that will prioritize community engagement and feedback. In that time period, we’ll identify research and storytelling partners […]. We will identify research priorities that complement existing research on unconditional cash transfers in the United States and invest in storytelling that honestly and authentically uplifts the experiences of recipients.

Thus, based on publicly available information, it is presently unclear when the project planned in Stockton will be launched, as well as what form it will take–including whether or not it will be an experiment (note the above emphasis on “storytelling” rather than comparison of data collected from control and treatment groups).

Basic Income News reporters will follow up with the conveners of the Stockton project, and provide more thorough, comprehensive and up-to-date information in a future stand-alone news article.

Reviewed by Heidi Karow

“Lab stuff” photo: CC BY-NC-SA 2.0 Rawbert|K|Photo

EU Minimum Income Overhaul

by Claire Bott | Oct 15, 2017 | News

The Employment Committee of the European Union (EU) has called for all member states to provide a minimum income, or to upgrade existing minimum income schemes.

A minimum income, unlike universal basic income (UBI), is not distributed to all citizens. In most European countries, a minimum income is already provided conditionally, taking the form of various unemployment benefits, child benefit schemes, disability support, pensions, etc.

Now the Employment Committee has recommended that these schemes be overhauled, or, in any cases where they are not already provided, that they be introduced. This is in response to the fact that 25% of people in the EU – nearly 120 million – are currently deemed to be at risk of poverty and social exclusion.

The Committee’s recommendations include setting the amount provided by consulting official figures such as the Eurostat at-risk-of-poverty rate. They also recommend raising awareness among those eligible for minimum income payments, in order to increase take-up of these schemes.

However, the Committee’s recommendation is not currently binding upon member states. It will now be considered by the full European Parliament, which will decide whether to vote this proposal into law.

Although minimum income differs significantly from basic income, this initiative could potentially pave the way for the development of some form of UBI in the future.

Basic income and the ‘job ethic’

by Michael Lewis | Oct 10, 2017 | Opinion

Written by: Michael A. Lewis

I was recently listening to a talk show on public radio. The first segment was about President Trump’s tax proposals. It included a debate between a supporter of Trump’s plan and an opponent of it. The supporter is associated with the Manhattan Institute, a conservative think tank. Her conclusion was that Trump’s proposed tax cuts would be great because they would lead to more economic growth and, therefore, more jobs. This is, of course, the supply-side/trickle-down economics reasoning, which could be a subject of debate itself.

A later segment on the talk show focused on New York City’s attempt to persuade Amazon to set up its headquarters in the city. For those who may not be aware, New York City’s mayor is widely considered to be politically progressive. If you are more familiar with European politics, you can think of him as something like a Social Democrat. He did not appear on the radio program, but one of his deputies did. The deputy said a primary reason the city wants to attract Amazon is that such a move would generate a lot of jobs.

Thus, there was a representative of a progressive mayor and a conservative, both of whom argued for two very different proposals on the same basis — jobs. This is not that unusual. The U.S. political Right and Left disagree on plenty: tax cuts, the proper role of the federal government, how best to improve U.S. schools, what the U.S. Constitution says about the right to own a gun, and a host of other issues. But both sides can always be counted on to agree that whether someone has a job or not is an issue of utmost importance.

Conservatives may argue that the best way to generate jobs is for the government to get out of the way and let businesses “do their thing.” Progressives may counter that the private sector will never create enough jobs for all those who desire one, and that the only way to assure people can find work is for the government to guarantee a right to work, even if it must do the hiring. But for both sides of the U.S. political spectrum, jobs are what matters.

It makes sense that both the Right and Left would be so focused on jobs. The main source of many, if not most, incomes in the U.S. is a wage or salary. For many people, if they lost their job, it would not be long before things became dire for them. For many of those currently without jobs, things are already quite dire. It is in the nature of capitalism for most of us to toil away as “wage slaves” as the Marxists define it. But it seems that over time, this economic necessity has developed into something many people call the work ethic, but which I have come to think might better be called the job ethic. The job ethic is the culture which develops when what we have to do to survive becomes not just a source of income but also one of social recognition.

In her book Justice and the Politics of Difference, the late philosopher Iris Marion Young has an essay on the definition of “oppression.” That essay is called The Five Faces of Oppression, and one of those “faces” is marginalization. Marginalization is what happens to the involuntarily unemployed. Obviously, those faced with this situation have a serious financial problem, given that they are living within a system which requires them to have money to meet their needs. But, according to Young, this is not the main reason involuntary unemployment is oppressive. The main reason is that those who are unemployed lack something which grants them access to being recognized and esteemed by their fellow citizens/residents — a job. It is this lack of a job which makes the unemployed feel cast aside and marginalized. The fact that someone is not willing to hire them results in their feeling socially worthless.

Being a philosopher/political theorist, Young does not support her argument with figures and statistics. But I think she may be onto something. A number of opponents of basic income seem to think so, too. Anyone who has followed the basic income debate has heard the argument that basic income is imprudent public policy because it would result in less work. Less work would mean people would be less inclined to engage in an activity which provides them not just with income, but also with meaning and social recognition. What these individuals are really saying is that basic income is bad social policy because it would result in fewer people having to obtain meaning and social recognition from what they have to do to “put food on the table.”

In the past, I have questioned whether basic income would have this effect. But I’m also inclined to wonder: So what if it does? As important as making a living is, humans do a lot of other things besides sell their labor. They spend time with children, spouses, and friends, they enjoy hobbies of various kinds, they engage in pursuits of higher learning, they become involved in civic pursuits to make the world a better place, and a host of other things. Can’t at least some of these things be sources of social recognition, as well? As long as capitalism and tasks that cannot be completed by machines exist, there will be a need for humans to sell their labor. But if a basic income freed some of us up to spend more time doing other things which provide us with social recognition, would that really be so bad?

About the author:

Michael A. Lewis is a social worker and sociologist by training whose areas of interest are public policy and quantitative methods. He’s also a co-founder of USBIG and has written a number of articles, book chapters, and other pieces on the basic income, including the co-edited work The Ethics and Economics of the Basic Income Guarantee. Lewis is on the faculties of the Silberman School of Social Work at Hunter College and the Graduate and University Center of the City University of New York.

AUSTRALIA: Alfred Deakin Institute Policy Forum – The Future of Work and Basic Income Options for Australia

by Patrick Hoare | Oct 6, 2017 | News

Jon Altman and Eva Cox. Credit to: Alfred Deakin Institute (Deakin University, Melbourne)

The Alfred Deakin Institute at Deakin University in Melbourne, Australia, hosted a forum on the 17th and 18th August discussing the concept of a universal basic income.

Workshop co-convenor Jon Altman (Deakin University and ANU) suggested that part of the impetus for the workshop was the sense that discussion of UBI in Australia was not as advanced as it was in other countries. As evidence of this he cited the comment made by Chris Bowen (Shadow Treasurer for the Labor party), who said that UBI was “a terrible idea”. Tim Hollo – Executive Director of the Green Institute – also highlighted the fact that the Greens were the only major party in Australia currently in support of the concept.

Dr Tim Dunlop – author of Why the Future is Workless – gave context to the discussion by talking about the state of work, technology and automation. He said the “salient point” in labour market analysis is that many problems are current. Evidencing this, he summarized some figures from the International Labour Organization, including; global unemployment exceeding 200 million in 2017; stagnation of real wage growth; decline in proportion of wealth going to wages; 760 million men and women worldwide in “vulnerable work”, defined as work unable to bring them above the the world poverty threshold of AUD $3.10 per day; millions in refugee camps and jails; record levels of over and under-employment; and the creation of “increasingly precarious” work.

Looking at future technology, Dr Dunlop said that the consistent finding was that “around 40 to 50% of jobs are at high risk of automation in the next twenty years” (Oxford Martins School Report, 2015) under “currently existing technologies” (McKinzie Report) and that it would be “close to a form of denialism”, therefore, to state, as many do, that “concerns about technological unemployment are overstated”. Associate Professor Karl Widerquist agreed with this point, stating that “people are not interchangeable parts” and often find that their “learn[t] skills” are “not needed any more”. In this regard, he said a UBI could compensate for the continual disruption of technology, and the inherent inability of workers to adapt and provide themselves with income. Phillip Ablett (USC), summarising work by Mullally, added that neo-liberalism’s emphasis “on ‘individual responsibility’ for poverty” contributed to this persecution of workers, where we tend “to blame individuals for their ‘failure’ to succeed in the market economy rather than consider the structural impediments to achievement”.

Professor Widerquist said a shift away from labour prosperity to capital prosperity has led to an “incentive problem” where employers don’t have an incentive to treat their employees appropriately since employees don’t have any power to refuse their conditions. The universal nature of a UBI, as such, would allow for a “voluntary participation economy instead of a mandatory participation economy”. Dr Frances Flanagan agreed that “capital accumulation” was central to the problem of “acute inequality”, however she expressed concerns that discussions around UBI focused too heavily on wage leverage and monetary incentive. Citing “care work” as an example “utterly antithetical” to the taylorisms of tasking and efficiency, Dr Flanagan said we need a more positive definition of ‘work’ since there are always ‘jobs’ that “require empathy, judgement and relationships”. UBI, consequently, needs to be “supportive of the fight for better jobs” and “[be] supportive of the fight against marketisation”. Professor John Quiggin (UQ) echoed Dr Flanagan’s concerns that UBI risks the possibility of replacing social services with a single payment, though he did point out that an unconditional stipend could destigmatise the concept of welfare payments to individuals, undermining the concept of the “deserving and undeserving poor”. Professor Eva Cox (AO) was also critical of UBI as a means to empowering a “protestant, male, Anglo” market system, where humans are economically judged as being good or bad “consumers”. She reiterated the need to revisit the concept of ‘work’ through a lense where humans were considered “social”, “dependent” and “interdependent”, advocating a UBI that was used to redefine “the social contract between the nation state and the individual”, with “reciprocity built into it”.

On the subject of evidence to support a UBI’s practical plausibility, both Professor Widerquist and Professor Greg Marston (University of Queensland) said that trials investigating the effects could be strategically dangerous since the trial conditions are often neither unconditional nor universal. Marston pointed to climate change as an example of where the accumulation of data has brought about, in many cases, confirmation bias in support of inactivity rather than impetus to instigate change. It was generally agreed that the issues of design and implementation were not, therefore, easily separated. Professor Quiggin, Troy Henderson and Dr Ben Spies-Butcher advanced the idea of a staged introduction, a “stepping-stone” approach which would retain the “big idea” excitement for voters and simultaneously satisfy technocrats. Quiggin’s preferred model was to favour the “basic” over the “universal” through various mechanisms and adjustments to tax regimes, introducing a full UBI payment to selected, vulnerable populations, and then gradually increase the number of people covered. The cost of everyone in Australia receiving a full UBI was estimated to be around 5-10% of GDP. Henderson and Spies-Butcher offered modelling that began by universalising the age pension, and by also introducing an “unconditional Youth Basic Income paid to those aged 20-24 based on a negative income tax model.”

In conclusion, the consistent theme of the two days was that UBI cannot be offered as a silver-bullet solution to issues around inequality, welfare, social security and the potential growing precarity of work. So while there is a tendency amongst advocates (worldwide) to present UBI as a single policy response for addressing many of the problems societies have with these issues, the very strong feeling of the workshop was that this could be a dangerous over-reach.

You can view some of the contributors speaking here.

More information at:

Kate McFarland, ‘NEW BOOK: Why the Future is Workless’, Basic Income News, November 5th 2016

Hilde Latour, ‘KARL WIDERQUIST: About Universal Basic Income and Freedom’, Basic Income News, July 31st 2017

Homepage of the International Labour Organization

James Manyika, Michael Chui, Brad Brown, Jacques Bughin, Richard Dobbs, Charles Roxburgh, Angela Hung Byers, ‘Big data: The next frontier for innovation, competition, and productivity’, McKinsey Global Institute, May 2011

Karl Benedikt Frey and Michael Osborne, ‘Technology at Work: The Future of Innovation and Employment’, Oxford Martin School, University of Oxford, February 2015

Oxford University Press, ‘The New Structural Social Work: Ideology, Theory, Practice 3rd Edition’, Bob Mullaly

17th BIEN Congress in Lisbon, Portugal

by Sara Bizarro | Oct 5, 2017 | News

The 17th BIEN Congress took place in Lisbon, Portugal from the 25th to the 27th of September. The focus of the congress was on “Implementing Basic Income.” The 150 presenters represented 33 countries, with more countries represented in the additional 380 audience members. According to Karl Widerquist, Vice-Chair of BIEN, this may have been the largest BIEN Congress since Brazil in 2010. The Congress included keynote presentations by BIEN co-founders Guy Standing and Philippe Van Parijs, in addition to keynote presentations about several Basic Income pilot programs, reflecting the congress’s focus on implementation, and from several political figures who are advocating for Basic Income in their respective countries.

The first day of the congress took place at the Portuguese Parliament (Assembleia da República), and as Standing said: “I am sure I speak for many of the co-founders, and many of them are here, that when we set up BIEN 31 years ago we never anticipated that we would be in a place like this in 2017.” The second and third days were held at ISEG, Lisbon School of Economics and Management, a beautiful venue that used to be a convent (Convento das Inglesinhas, restored by architect Gonçalo Byrne) that has kept many of its original architectural features and now hosts the university’s post-graduate programs.

Evelyn Forget, photo by Luis Gaspar

Starting the keynote session on Basic Income pilot programs, Evelyn Forget’s presentation was about the differences between the narratives attached to several Basic Income experiments. She underlined that different narratives will create different criteria of success. For example, Finland’s narrative is about long-term unemployment and incentivising return to work. In this case, the experiment will be successful if people return to work. Ontario’s narrative is about social justice and a gap in benefits for adults because of the new reality of precarious work and poverty issues. Their goal is to expand the welfare state. Silicon Valley’s Y Combinator’s narrative started out as an utopia put forward by private individuals who wondered what would happen once automation freed people to do what they want. Forget stressed that “context matters” in pilot programs, and she suggested that when we bring together all these shared experiences, we can create newer and richer narratives.

After Forget’s insights, there were several presentations about specific pilot programs being developed. Karen Glass, from the experiment in Ontario, Canada, described the pilot program as a type of Negative Income Tax program, since the payments decrease as the recipients start working. The Ontario project applies to households and encompasses individuals aged 18 through 64, who have been residents of the region for one year. The pilot provides a guaranteed annual income of $17,000 dollars per individual and $24,000 per couple, which is 75% of the low income measure. The success criteria are not focused primarily on work incentives, but on recipients’ improved health, reduction in anxiety and the ability to make ends meet. Elizabeth Rhodes from Y Combinator, a seed investment company, talked about the contours of what this private experiment wants to achieve. Y Combinator has already financed a feasibility study in Oakland. and now plans to select 3000 participants who will receive 1000 dollars per month, some for three years and others for five. There is an income cap in the selection and they will be undersampling higher incomes. Presently the program is considering selecting subjects 21 to 40 years in age. The pilot intends to evaluate well being, mental and physical health, social and civic engagement and social networks effects as well as effects in the children of the participants. The research team has been piloting and testing their methods with a smaller group of participants.

photo by Enno Schmidt

Joe Huston spoke about the experience of GiveDirectly in Kenya. GiveDirectly has raised funds privately and has been distributing them to around 100 people, but once the project is fully launched there will be up to 26,000 people receiving some type of cash transfer. The pilot is divided into three groups, one group will receive a monthly payment for 12 years, another for 2 years and yet another will receive a one time cash grant of the same amount. The 100 people who are receiving a monthly Basic Income already have reported on their experiences, and, as Huston says,many have reported they did not reduce their work efforts; instead, many have several projects that need to be completed (such as paying for school and building a house), so they need to work. Others have pulled their Basic Income payments together in something called “table banking” and give a larger sum to each member at a time so that more can be achieved. Giving to individuals as opposed to households has had the emancipatory effects that are often theorized: because each person receives an equal amount of money, it is easier to solve household disputes. Regarding how the money is spent, Huston says that Basic Income debates seem to oscillate between saying that people will become lazy bums or startup engineers; however, both extremes are inaccurate and do not apply to what is happening in the village so far. Huston explains that when walking from house to house in Kenya one can see a diversity of life choices: “Irene spent some in purchasing a goat for about $12 and kept some of the money as savings. Eric spent most of his money in a fishing net, saved some of the money and bought small fish like anchovies for a snack. Frederick spent most of the money in school fees.” So far, each person used the money as is more adequate in their particular circumstances.

Photo by Enno Schmidt

On the political arena there were several important participants. From Germany, Cosima Kern spoke about the new Basic Income single issue party, and explained that since Germany has no direct democracy (in contrast to Switzerland) this is a way to force Basic Income into the political arena. The Basic Income party had almost 100,000 votes in the election that took place on day before the Congress, which Kern said is a good result for a new party. Enno Schmidt talked about the referendum in Switzerland and also underlined that the 23% vote for Basic Income was a great first result, reminding everyone how it took 17 years of discussion in Switzerland for women to have the right to vote. Lena Stark spoke about the new political party in Sweden in the same vein as the German party; they plan to run for elections in September 2018. Ping Xu presented the situation in Taiwan with the help of Tyler Prochazka. Taiwan has the highest housing costs and the lowest birth rates, and would be an ideal site for a full implementation of Basic Income. From Japan, the ex-Minister of Agriculture, Masahiko Yamada, spoke about the importance of Basic Income in his country, which is facing new economic challenges that urgently need to be addressed.

Ronnie Cowan, Photo by Luis Gaspar

Finally, the Scottish MP Ronnie Cowan inspired the audience with his privileged viewpoint regarding how politicians tend to operate and the heartfelt way that Scotland is pursuing their Basic Income pilot programs. Mr. Cowan said that politicians rely on experts, but experts and academic often disagree, and politicians need facts and figures, which is why experiments are so important. With pilot schemes, we can monitor outcomes; they can be used to tell if “people are happier, more socially engaged, eating healthier, if kids are doing better at school, we can measure the benefits against the cost.” Mr. Cowan concluded: “Basic Income really comes alive for me when we consider it’s for everyone. It is not means tested. It is not subject to the disability test. It removes stigma. It creates choice and it’s absolutely dripping in humanity.”

Guy Standing and Philippe Van Parijs, photos by Enno Schmidt and Luis Gaspar

The two main keynote speakers, Guy Standing and Philippe Van Parijs, also captured the audience’s interest with their presentations. Standing celebrated the 800 year anniversary of The Charter of the Forest, a piece of legislation that was valid for 754 years, only repealed in 1971. Standing argued that the commons defended in The Charter of The Forest have been plundered upon for hundreds of years, and Basic Income is a way to bring back the commons. He defended the position that Basic Income should be seen as a social dividend based in the commons and land tax, not something that will send income tax through the roof. Van Parijs spoke of the right to work and the duty to work. He argued that even though many see Basic Income as an attack on these, it actually facilitates both. Basic Income can organically encourage part-time work and therefore job sharing, thus promoting the right to work. Basic Income can also allow for the duty to work to be expressed in a meaningful way that includes paid and unpaid jobs. According to Van Parijs, the duty to work cannot mean simply doing something for a salary; it should be viewed more widely as a duty to participate in society in a meaningful way. Basic Income can liberate people to participate in such a way by either allowing them to chose paid work that is more meaningful, or by choosing other unpaid useful work. If we eliminate the idea that people have to work in whatever they can to survive, the morality of what one chooses to do will come to the forefront, allowing the duty to work in a more meaningful way to become center stage as far as human activity is concerned.

The keynote presentations wrapped up with Eduardo Suplicy from Brazil, ex-Senator and long time defender of Basic Income, and Francisco Louçã, member of the left wing party Bloco de Esquerda in Portugal. There were also many other local Portuguese participants, as well as a slew of media attention related to the congress (which will be discussed in a future Basic Income Newspiece). The congress also included 37 parallel sessions, among others, Malcolm Torry’s presentation on Defining Basic Income, sessions on Degrowth, Digital Economy, Communicating about Basic Income, and many other topics, as well as two films, Christian Todd’s Free Lunch Society and Rena Masuyama’s Film Project, the first fiction film about Basic Income produced in Japan. Summaries of all the sessions provided by the chairs should be available in about one month at the Portuguese Basic Income Site, for now there are papers and presentations and videos of the event available of the site.

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