by Ashley | Sep 10, 2017 | News
Pictured: Kenyan village to receive GiveDirectly’s guaranteed basic income Source: Nichole Sibecki for NPR
GiveDirectly offers to give every adult in a Kenyan village a guaranteed basic income of 27,258 Kenyan Shillings- or 264 US dollars- per year for the next 12 years without any conditions. Providing unconditional cash transfers directly to people has proven to increase economic outcomes and psychological well-being.
GiveDirectly, a US-based nonprofit, is challenging the traditional structure of international aid by shifting the power dynamics between donors and people who receive aid. In our current structure, donors decide what people receive since most aid provided by governments, nonprofits and individuals is given as an in-kind donation. Instead, the purpose of GiveDirectly’s donation structure is to trust the expertise of people experiencing poverty to choose how best to spend the money. GiveDirectly will be measuring the long-term outcomes.
According to the first part in an NPR series on emerging aid models to redress global poverty, GiveDirectly will provide every adult in a village in Kenya a guaranteed basic income of 2,271.50 Kenyan shillings per month, or 22 US dollars for the next 12 years. Typically, adults live on less than 206.50 Kenyan Shillings per day, or 2 US dollars. For two-parent households, this donation boosts their monthly income by 50 percent. The money is wired to a bank account connected to each villager’s phone. Some families have used this additional income to better support household nutrition and education outcomes for children. The US-based nonprofit plans to expand the guaranteed income to 200 villages in Fall 2017 and assess the long-term impacts by comparing the outcomes with 100 villages that do not receive the payments.
Already, a study published in the Quarterly Journal of Economics discovered how, in Kenya, unconditional cash transfers (UCTs) have a significant impact on economic outcomes and psychological well-being in communities. UCTs contribute to local economic development by increasing consumption rates. They also improve social and emotional development in communities that heavily rely on social networks for supports and services that may otherwise be inaccessible.
Research from Canada’s Mowat Centre also shows that providing money with no strings attached can help support social entrepreneurs that may be experiencing financial hardship to get their ventures off the ground. For example, one Kenyan family that is a beneficiary of GiveDirectly’s donation, is focused on investing in an entrepreneurial venture to grow a forest of eucalyptus trees and sell the fuel from the plants. Profits from the family’s venture would be used to fund high school tuition for four children as an investment in breaking the intergenerational cycle of poverty.
In contrast to GiveDirectly’s aid model, Zambia’s government is choosing to filter who receives aid and under what conditions. Originally, a government program gave families in a rural west Zambian village 164, 628.31 Zambian Kwacha, or 18 US dollars, every other month for the past five years. The program proved to be successful: families used this additional support to invest in creating multiple business ventures to multiply their capital. To help aid these business ventures, the usage of related software can make this a lot easier, and with advancements in technology, businesses are able to conduct remotely accessing Sage software services so they are always on point with what they require. The government has therefore decided to scale up the program to increase the population receiving this cash aid. Simultaneously, the government has decided to limit the cash transfer to exclude people such as those who initially received the money in the pilot program: two-parent households, people who are employed, and people who are able-bodied. Instead, Zambia will provide aid only to single-parent households, people with disabilities, seniors, and people who are unable to work. This limitation on providing aid based on who is deemed eligible is what GiveDirectly is challenging.
GiveDirectly’s guaranteed income in Kenya is increasing access for all with the goal of improving health outcomes and building towards financial security. It can be particularly valuable for people with disabilities who often experience job discrimination and barriers to financial self-sufficiency. For them, this monthly influx of cash provides a foundation for independence. People with disabilities often struggle to afford medication and rely on financial support from other family members to sustain themselves. This additional monthly income will help to mitigate the costs of medication and basic necessities for everyone.
Grassroots savings clubs in low-income communities are another asset to consider when measuring the long-term impacts of GiveDirectly’s guaranteed income. Some people do not have access to banks or struggle to save money when it is easily accessible from an electronic savings account. Savings clubs are typically groups of 10-15 community members who collectively pool their resources each month. The total amount is then provided to a different individual from the savings club to look after for a month. This community-based savings account relies on faith in the community members to manage the money for everyone else. Some villagers have noted how critical this social bonding is to allow them to maintain their savings since they know the community is depending on them to effectively manage their budget. Researchers have found in case studies around the world, from Bangladesh to Central/South America and West Africa, that savings club serve as a common element of the economic infrastructure in low-income neighborhoods.
Giving cash directly to children and families, with no strings attached is being shown to improve the quality of life in a number of communities, particularly in boosting economic, health, and education outcomes. As more organizations begin measuring the long-term impacts of unconditional cash transfers and basic incomes, we will continue to gain evidence on whether these are viable solutions to deeply entrenched social issues like global poverty.
More information at:
Ashley Blackwell. “CANADA: Mowat Centre Report Shows Impact of Basic Income on Social Entrepreneurship.” BIEN. 28 July 2017.
GiveDirectly. “Basic Income.” 4 September 2017.
Johannes Haushofer and Jeremy Shapiro. “The short-term impact of unconditional cash transfers to the poor: Experimental evidence from Kenya.” The Quarterly Journal of Economics vol. 131 (4). 1 November 2016.
Nurith Aizenman, “How to Solve Poverty: Why Not Just Give People Money.” NPR. 7 August 2017.
“Cash Aid Could Solve Poverty- But There’s a Catch.” NPR. 9 August 2017.
“How to Buy A Goat When You’re Poor? Join A ‘Merry-Go-Rund’.” NPR. 19 August 2017.
by Sara Bizarro | Sep 4, 2017 | News
The Green European Foundation will host a workshop about Basic Income during the upcoming 9th Edition of Univerde, a University Summer program that is one of the largest forums for debate on ecology and politics in Spain. Univerde is organized by the Green European Foundation together with the EQUO foundation with support from the political party Los Verdes/ALE and the European Parliament.
The event will take place at the University of La Rioja in Logroño, Spain on September 8 and 9. The Basic Income Workshop will happen on September 9. Participants include: Philippe Van Parijs, Belgian philosopher and political economist, and a professor at the Faculty of Economics, Social and Political Sciences of the Catholic University of Louvain; Hontanares Arran, Member of the Movimiento ATD Cuarto Mundo and member of EQUO; Lluís Torrens, economist, member of the Basic Income Network and Director of Planning and Innovation of the Social Rights Area of the Barcelona City Council; Julen Bollai, economist and researcher, member of the Basque Parliament with the Coalition of Elkarrekin Podemos, and member of the Basic Income Earth Network (BIEN); and Jorge M. Neira, member of EQUO.
The workshop titled “Moving towards Basic Income: a Pilot Program for the City of Madrid” will evaluate Basic Income as an alternative to poverty and exclusion. it will look at the possibility of developing a pilot program at a local level in Madrid to prepare for a generalized implementation of Basic Income. They will analyze the proposal suggested by the Spanish organization Marea Básica for a pilot program in a neighborhood in Madrid that is riddled with poverty and exclusion. Experts on Basic Income will give their opinion on this possible pilot program, and the workshop will be used to debate Basic Income as a social protection alternative that is ecologically sustainable.
More Information
[In English]
Univerde IX Edition in Spain
Moving towards Basic Income at Univerde
Kate McFarland, “MADRID, SPAIN: “UBI is Coming!” (UBIE conference, Oct 15-16)”, October 12th, 2016
[In Spanish]
Program of the Univerde Workshops
Marea Básica
by Kate McFarland | Sep 1, 2017 | Research
Teppo Eskelinen and Johanna Perkiö have published “Micro-investment perspective and the potential of the universal basic income” in Development Policy Review (June 2017).
Eskelinen and Perkiö analyze basic income as a tool to promote micro-investments by poor individuals and households, hypothesizing that a basic income would impart to such households a “greater confidence to undertake more risky activities, knowing they will have a minimum income to fall back on.”
As they explain in the abstract, the authors “aim to estimate potential impacts of the BI by synthesising existing knowledge. This estimation will not be quantitative, but rather show likely outcomes of a BI scheme. We will complement existing knowledge by exploring cognate cash transfer policies and other experiences that bear similarity to the BI.”
As a core part of their analysis, the authors examine the pilot studies conducted in the Namibian village of Otjivero-Omitara (2008 to 2009) and the Indian state of Madhya Pradesh (2011 to 2013), looking especially at the effects on “labour, behavioural impacts, psychological impacts, and investment in human capital.” Regarding psychological impacts, they point out that, in the Madhya Pradesh experiment, “households receiving cash grants were three times more likely to start a new business or production activity than control group households,” which appears to affirm their conjecture that “the availability of money combined with a sense of security is what eventually determines the occurrence of micro-investment.” Regarding behavior, they note a “recurring observation” that part of recipients’ additional income was “invested in income-generating activities.”
Eskelinen is a philosopher and social scientist who has published on political theory, political economy, global justice, and development theory. He is senior lecturer at University of Jyväskylä.
Perkiö is a doctoral candidate in the social sciences at the University of Tampere, writing her dissertation on the history of the basic income debate in Finland (see her November 2016 presentation for Kela). Many of her previous articles and blog posts on basic income available online, including the Transform! Network discussion paper “Basic Income Proposals in Finland, Germany and Spain,” the International Solidarity Work report “Universal Basic Income – A New Tool for Development Policy?,” and a response to the OECD’s recent critical report on basic income, published on Kela’s blog.
Reviewed by Russell Ingram
Photo: Store in Madhya Pradesh, CC BY 2.0 Brian Gratwicke
by Kate McFarland | Aug 31, 2017 | News
Nature Needs More, a wildlife conservation group based in Australia, is currently investigating the potential of basic income to help curb illegal hunting.
Founded in 2013 under the name Breaking The Brand, the group’s first advocacy and educational campaigns focused on curbing the demand for the products of illegal hunting, such as rhinoceros horns. As its work progressed, however, Breaking The Brand realized that its demand reduction campaigns could not be sufficient to stop illegal wildlife trade; successful wildlife conservation “needs more”.
Now called Nature Needs More, the organization is exploring new strategies, including a basic income pilot project designed to measure its effects on hunting and wildlife conservation.
Elephants in Namibia, CC BY-NC 2.0 Frans Vandewalle
Nature Needs More is inspired in part by the Basic Income Grant Pilot Project conducted in 2008 in the Namibian town of Otjivero. Prior to the introduction of the basic income grant, the local police station commander told researchers that poaching was the most common criminal activity, stating, “Poverty and unemployment are the reasons for these criminal activities. Otjivero is a tiny place and there is no source of income there. Most people hunt or poach just for survival.” In 2007, 20 instances of illegal hunting and trespassing were recorded between January 15 and October 31. In 2008, however, after the introduction of the basic income pilot, the count fell to only one instance during the same time period.
As Nature Needs More notes on its website, current basic income experiments–such as the 12-year randomized control trial that the non-profit GiveDirectly is due to launch in rural Kenya in September–are not linked to conservation outcomes.
Thus, the organization is considering the possibility of launching its own basic income experiment within the next two years.
Describing its hypothesis, Nature Needs More states, “Financial security would not only mean less poaching for food [and] less illegal harvesting … but would [also] mean wildlife trafficking syndicates would have less leverage to recruit poachers from the impoverished communities neighbouring key conservation areas.”
The organization is also exploring whether a basic income might help conservation areas convert to ecotourism as a revenue source.
Reviewed by Caroline Pearce
Rhino photo CC BY-NC-ND 2.0 Martin Heigan
by Florie Barnhoorn | Aug 28, 2017 | News
As the social assistance experiments in several Dutch municipalities will begin this fall, Studium Generale of Utrecht University has organized an event dedicated to ‘Free Money‘.
Studium Generale is a university’s public platform for knowledge sharing and reflection by organizing lectures, seminars and other activities aimed at students and the general public. Entrance is always free and accessible without reservation.
In the Netherlands, municipalities are responsible for the provision of tailor-made benefits to anyone who has insufficient means to support him or herself, and for achieving the purpose of the Participation Act, that is, making recipients independent from social assistance. Several municipalities are conducting two-year experiments, in the context of which they have the option of implementing social assistance regulations in an alternative way.
Each experiment will include at least three treatment groups, who are subjected to various regimes, and a control group. The restrictiveness of obligations between the groups will vary, from a group which has fewer obligations imposed on it to a group which is even more intensively supervised. In addition, participants in a third treatment group may retain a limited amount of their income from work on top of their payments. See the links at the bottom of this article for more details.
Researchers of Utrecht University, one of the four universities that will supervise the experiments scientifically, have been critical about the design of the pilots because of its limited scope and complicated nature.
The experiments, as they are proposed now, raise a number of questions, such as: why don’t we all give a basic income? Is it too expensive, or are there any other objections?
Rutger Bregman (The Correspondent) and Professor Ingrid Robeyns (political philosopher and economist at Utrecht University) will address these issues during the “Free Money” event on October 25, 2017.
Rutger Bregman has written several books on ‘Free Money’ — for instance, Utopia for Realists — and was one of the speakers at TED2017 in Vancouver last April.
Ingrid Robeyns holds the chair in Ethics of Institutions. In her teaching she focuses on normative and applied ethics and (normative) political philosophy. She has been teaching about justice theories and economic ethics at the masters level in recent years. In her own research, Robeyns addresses a number of normative issues related to demography, gender, family, and institutional economy. Robeyns writes for the English-language group blog Crooked Timber and occasionally on her own site Buiten Categorie. She will also be one of the speakers during BIEN’s 17th Congress next September in Portugal.
The event will take place on October 25, 2017. The language is Dutch. Those interested are invited to join the discussion on Facebook event. For more details, see here.
Previous information on social assistance experiments in The Netherlands:
Florie Barnhoorn, “The Netherlands: Amsterdam on collision course over social assistance experiments” (August 5, 2017).
Florie Barnhoorn, “The Netherlands: All that’s left is the action. Where do we stand with the experiments?” (June 2, 2017).
Kate McFarland, “The Netherlands: Social Assistance Experiments Under Review” (May 9, 2017).
Florie Barnhoorn, “The Netherlands: Design of BI Experiments Proposed” (October 26, 2016).
Credit Picture Flickr.com CC Ealasaid.
Thanks to Kate McFarland for reviewing this article.
