by Andre Coelho | May 16, 2017 | News
Back in 2014, Johan Bollen and four other colleagues published an EMBO report, presenting a new and radical approach to scientific funding. Since then, Johan has paired with Marten Scheffer so as to develop and communicate further the notion of SOFA – Self Organized Fund Allocation. Scheffer has recently led the Dutch parliament to ask the Netherlands Organization for Scientific Research (NWO) to start a SOFA test pilot.
But what is a SOFA? It is a new way to allocate funds for scientific research. The traditional approach usually means a funding agency receiving many applications, which entail a time-consuming process in itself. Plus, it costs a large percentage of the funding amount to run and manage this top-down driven system. According to a recent article on the issue, by Jop de Vrize, that percentage can be as high as 25%. On top of that, it has been proven highly inefficient, since the success rate of these application is usually below 20% (19.1% in 2016 according to the US National Institutes of Health, and 11.3% at the European Research Council Starting Grants for the same year). The result is that some scientists get lots of money, while a lot of others get a fraction of that money, or even nothing.
The new SOFA funding scheme is, at its core, a distributed, self-allocating system. The funding agency still attributes a certain amount of money to a research community, but then, instead of going through a cumbersome, time-consuming, unfair and inefficient process of distribution, the idea is to get the researchers themselves to allocate funds to other researchers. Specifically, the SOFA system would attribute an equal, unconditional amount of money to each researcher – a certain earmarked value by the agency, divided by all researchers in the community – and then each one would donate 50% of their present and past funding [1] to other scientists, trusting their best judgment.
Proposed funding system (Johan Bollen et al.)
Of course, this new system is not devoid of problems, or potential challenges. Freed to allocate 50% of their research income to other scientists, researchers could choose to give money only to their friends, collaborators or mentors. Also, the problem of the money not reaching those who are needing it the most may still arise, only partially offset by the unconditional amount that will be equally distributed (50% of each year’s grant). However, Bollen and Scheffer are confident, after running many simulations, that “rather than converging on a stationary distribution, the system will dynamically adjust funding levels to where they are most needed as scientists assess and re-assess each other’s merits”. They also agree that the system would have to be include programmed features to avoid self-attribution and hide funding decisions (to keep decisions unbiased), for instance. An important feature of the SOFA system is that no one individual researcher has access to enough information so as to try and influence the attribution mechanism (contrary to the present system, which is more easily politically malleable).
The unconditionality associated with the SOFA scheme, plus its widely-distributed nature draws some similarities with the basic income concept. Basic income, as defined at the Basic Income Earth Network (BIEN), rests on the independence of income and work-status, or even willingness to work. Granted, the SOFA scheme implies that the money is distributed among scientists, devoted and committed to scientific work, with clear and established study plans. However, it is also clear that some of the previous conditions associated with funding decisions – mainly a discussable notion of merit coming from a very small group of peer-reviewers who end up allocating the grants – will collapse if SOFA is introduced. Another similarity with basic income proposals has to do with de-complexification of the attribution system, also reducing its overhead costs, as a function of both distributing 50% of the grants unconditionally and putting in the hands of the researchers themselves the responsibility of distributing the other half of each grant. In the basic income arena, that advantage usually takes the form of reduced costs with social security management, and lowering complexity through existing program’s extinction and remodeling. A third similarity has to do with trust. Unlike the present system, SOFA inherently trusts researchers to allocate 50% of their grants to others. This trust is also present in most basic income proposals, which allow recipients to spend their basic income as they see fit, hence furthering their personal freedom and capacity to more efficiently solve problems in their own lives.
The SOFA scheme has been presented to Eppo Bruins, a member of the Dutch House of Representatives, who proposed a call for a SOFA test pilot in June 2016, which was approved by the parliament. However, the NWO, the agency which would start and manage the experiment, has resisted the initiative. According to Scheffer, that is understandable, since “if applied universally, the novel system would make the agency redundant”.
Notes:
[1] – Management of past funding options is still not included in the proposed model, but is considered important by the authors, to better use of unused funds.
More information at:
Johan Bollen, David Crandall, Damion Junk, Ying Ding, Katy Börner, “From funding agencies to scientific agency”, EMBO reports 15 (2), September 7th 2014
Jop de Vrize, “With this new system, scientists never have to write a grant application again”, Science (American Association for the Advancement of Science), April 16th 2017
by Genevieve Shanahan | May 12, 2017 | Opinion
David Piachaud, Emeritus Professor of Social Policy at the London School of Economics, last November put forward a four-pronged case against basic income – on the grounds of justice, simplicity, economic efficiency and political feasibility. While the argument, I believe, fails on all four counts, I’ll here focus on the justice argument.
To summarize, Piachaud outlines Philippe van Parijs’ famous argument for basic income from his 1991 paper “Why Surfers Should be Fed: The Liberal Case for an Unconditional Basic Income” and claims that the fatal flaw of van Parijs’ argument is that he does not take into account a crucial distinction between the voluntarily and involuntarily unemployed.1 The former value their leisure, it is posited, at least as much as the lowest wage paid to their employed counterparts. In this way, only redistribution of income to the involuntarily unemployed can be justified on Rawlsian grounds. Unfortunately, Piachaud overlooks or underestimates van Parijs’ lucid explanation of why both are entitled to the basic income. In what follows, I’ll try to show why van Parijs’ argument is unaffected by Piachaud’s critique.
The Difference Principle
Both van Parijs and Piachaud begin their arguments from the Difference Principle – a key concept in political philosophy since its first presentation in John Rawls’ seminal A Theory of Justice in 1971. Briefly, the Difference Principle states that social and economic inequalities (or inequalities in terms of “primary goods”) are justified only insofar as they benefit the least advantaged. The most important consequence of this principle, on Rawls’ account, is that it justifies inequality in wages to the extent that offering higher wages for valuable work, or steep rewards for successful innovation, incentivises the types of behaviour that generate economic growth and thereby increase the standard of living for all.
A crucial point for the Difference Principle, of course, is determining who counts as “the least advantaged”. One of the first criticisms of Rawls’ theory was that, if the least advantaged are just the people who have the least wealth, it would unfairly favour people who prefer smaller incomes and a lot of leisure over those who prefer to work hard and earn vast sums. If we imagine that the “least advantaged” in our society are those who can only find minimum wage employment (leaving aside other clear forms of disadvantage, like chronic illness and disability, or marginalization), it can seem intuitively perverse to treat those who choose not to take up that minimum wage job as more disadvantaged, and therefore more deserving of public assistance, than those who do. It’s pretty natural to think, “Well, if the surfer doesn’t do the best he can to get that job at McDonald’s, that’s his look out. We can’t be expected to support him when he’s perfectly capable of supporting himself.”
To avoid counterintuitively lavishing taxpayer money on the surfer, then, Rawls proposed that leisure time be treated as a primary good:
“[T]wenty-four hours less a standard working day might be included in the index as leisure. Those who are unwilling to work would have a standard working day of extra leisure, and this extra leisure itself would be stipulated as equivalent to the index of primary goods of the least advantaged. So those who surf all day off malibu must find a way to support themselves and would not be entitled to public funds.”2
This basically gets us to the social welfare system as we (aspire to) have it now: public funds are used to support the least advantaged, who are those who cannot find employment, whether due to incapacity or a lack of jobs. To ensure this support only goes to those who are the least advantaged, conditions and testing are applied – recipients of benefits must prove that they cannot work or that they are actively looking for work. And while basic income advocates often point to the inefficient costs associated with conditionality, such that it may be better for everyone if we just accept and absorb the cost of free-riders, van Parijs points out that people are likely to be willing to forgo efficiency gains to preserve their view of fairness. That is, if we are to gain the requisite political support, we must show that basic income is not merely efficient but also just and fair on a reasonably intuitive view of fairness.
Philippe Van Parijs (photo credit: Enno Schmidt)
Twenty years after Rawls introduced the Difference Principle, van Parijs took this idea and extended it. While most of us basic income advocates aren’t primarily motivated by concern for surfers who can’t possibly take a 9-to-5 job because it wouldn’t leave them adequate time to catch the perfect, most righteous wave, van Parijs’ strategy is strong. If it can be shown that even surfers – capable but unwilling to work – deserve a basic income sufficient to live on, it would seem to follow that everyone else does, too. How, then, does van Parijs get from Rawls’ support for conditional income support to the full, universal, unconditional basic income that would be paid even to the surfer?
Is Leisure Time a Resource?
Van Parijs argues that it is in fact unfair to treat leisure time as a primary good. As a liberal theory of justice – that is, a theory that is neutral regarding what constitutes a “good life” – the Difference Principle should not favour those who prefer working over those with other values. This means that, while we might say that people have to work to pay their own way on the grounds of justice, we can’t say people should work simply because hard work and self-denial is virtuous. Van Parijs shows, by means of a thought experiment, that such discrimination is the result if we follow Rawls and treat the value of leisure time as equivalent to the wage one could earn in the same time if one were working.
This thought experiment involves examining what the consequences of the approach would be in the case of an “exogenous windfall”, such as the state discovering valuable oil and gas reserves off its coast. In the case of such a windfall, the incomes of those who are working or deemed deserving of income support would (ideally3) increase, but the surfer’s set of primary goods would stay the same (i.e., he would have his day of leisure and empty pockets both before and after the windfall). The surfer is thus excluded from the benefits of the windfall – to which he is equally prima facie entitled as a citizen of the state – simply because his leisure time is deemed to be equivalent to the wage earned in a standard working day.
Here Piachaud enters the fray, defending Rawls’ suggestion that the voluntarily unemployed must value their leisure at least as much as the wages they forgo. If the surfer continues to shirk employment at the new, higher wage permitted by the exogenous windfall, the argument goes, it must be because the value of his leisure, to him, was all along at least equivalent to the new higher wage. In this way, the surfer’s share of primary goods continues to be at least equivalent to that of the least advantaged worker.
Piachaud’s argument here relies on a distinction between the voluntarily and involuntarily unemployed, drawn on the grounds of the value of leisure time to them – measured by their willingness or not to take up work where it is available. This is a mistake, however, though one very easily made (I feel its pull constantly in these discussions). It is a mistake because leisure time, like any other primary good, should not be valued at the level of the individual. It doesn’t matter that I value my leisure time a lot and you don’t. What matters is the value of this resource as determined by the market – that is, as van Parijs puts it, “in terms of competitive equilibrium prices.”4 Van Parijs here draws upon another widely influential theorist of distributive justice, Ronald Dworkin, who elegantly shows in “Equality of What? Part 1: Equality of Welfare” that what egalitarians must be concerned with is not equality of happiness, or preference satisfaction, or welfare, but rather equality of resources.5
Let’s illustrate the surfer’s evaluation of his leisure time with a more concrete example. Say I *love* lager. If you hand me a glass of the finest champagne at a party, I’ll hand it back and say “thanks, but please, give me a bottle of lager instead”. If it happened that it was incredibly expensive to make lager, such that one bottle cost $100, I would still buy cases, forgoing many other pleasures. That I live in a world where lager is pretty cheap is lucky for me. But should I be charged more so that the price I pay better reflects its value to me personally? No – that would be unfeasible (how, exactly, would vendors measure each customer’s preferences to ensure they were charging the right price?) and nonsensical (by the same logic, I could pay $5 for the champagne since I only get $5 of enjoyment from it, despite its massively higher market price).
The Costs to Others of Our Choices
This isn’t a simple question of efficiency. What we’re looking for, from a justice perspective, is that no one impose costs on others. It would be wrong from me to pay only $5 for the champagne, despite my personal judgement of its value, because of the vastly greater cost to others of producing it. Dworkin puts it this way – as a matter of justice, “people must pay the actual cost of the choices they make […] measured by the cost to others of those choices.”6
Returning, then, to the distinction between the voluntarily and involuntarily unemployed, van Parijs argues that it is welfarist – that is, mistakenly pursuing equality of welfare rather than equality of resources – to apply willingness-to-work conditions to the basic income. This approach “charges” for leisure time based on whether the able-bodied potential worker enjoys the time off or not (as clumsily measured by Jobcentre assessments of employment search efforts). As we’ve outlined here, the correct price to “charge” for leisure time is its cost to others – the worth of what others might have to give up for us to have that leisure time.
Doesn’t a basic income immediately violate this principle, requiring the rest of society to hand over a portion of their earnings to the voluntarily unemployed? Van Parijs says it does not, because the basic income, fundamentally, is just the individual’s share of the world’s resources he was entitled to from the start, by virtue of being a person.
It should be noted that van Parijs does distinguish between voluntary and involuntary unemployment in a way that affects the level of the basic income. Piachaud and van Parijs both agree that, where there is involuntary employment (i.e. not enough jobs to go around), there are employment rents that are properly subject to redistribution. That is, in a perfectly competitive, idealised labour market – where everyone has access to all relevant information, there are no geographical limitations to what jobs an individual can apply for, and there are no costs associated with hiring and firing, or regulations like minimum wage – supply and demand would balance. Workers’ wages would simply be the actual market price of their labour, and there would be no unemployment attributable to lack of jobs. By contrast, in any real labour market there is friction – due to imperfect access to information, geographical limitations, hiring and firing costs, and regulations – which means that many workers are paid more than would be necessary in a perfect market for their labour, and many eager potential workers are left without a job. In this way, on van Parijs’ account, the level of the basic income can rise and fall in accordance with the level of employment rents in a labour market.
“[…] in the case of scarce jobs, let us give each member of the society concerned a tradable entitlement to an equal share of those jobs. […] If involuntary unemployment is high, the corresponding basic income will be high. If all unemployment is voluntary, no additional basic income is justified by this procedure.”7
As another way of understanding this point, van Parijs suggests that we think of jobs as resources in themselves (though Piachaud does not seem to entertain this line of reasoning). Perhaps the classic way of thinking of a job is as labour one expends in exchange for resources (a wage). Yet we know that jobs are much more than that – many jobs have value beyond the wage earned, whether in terms of meaning, enjoyment, community, status, etc. This is part of the reason why one might not value the increase in leisure time afforded by unemployment: even where conditional unemployment benefits are generous, most people still prefer work. Since available employment is limited due to the market inefficiencies outlined above, the surfers are doing the aspiring workers a favour, correctly assigning themselves to the ranks of the unemployed so that more jobs are available for those who want them.
If we return, then, to the idea of justice as not imposing costs on others, we can see that the surfers are in the clear. The lowest level of basic income simply corresponds to each individual’s rightful share of the world’s natural resources. Then, where there are additional resources to be redistributed due to the existence in a labour market of employment rents, this is to compensate for the costs imposed on the unemployed by the employed in taking up scarce jobs. There is no distinction between the voluntarily and involuntarily unemployed in entitlement to this level of the basic income – each equally provides a benefit to the employed by freeing up their share of jobs and the various non-monetary benefits that go with them. Directly anticipating and defusing Piachaud’s claim that such rents should only be redistributed to the involuntarily unemployed, van Parijs warns:
“adopting a policy that focuses on the involuntarily unemployed amounts to awarding a privilege to people with an expensive taste for a scarce resource. Those who, for whatever reason (whether to look after an elderly relative or to get engrossed in action painting), give up their share of that resource and thereby leave more of it for others should not therefore be deprived of a fair share of the value of the resource. What holds for scarce land holds just as much for scarce jobs.”8
Arguments about distributive justice like these, that drill down to the fundamentals of the way our economies and societies work, are necessarily abstract. It’s therefore important to be wary of directly inferring real-world policy from such idealised thought experiments. Nevertheless, amidst the complexity of our modern interlocking economic systems, the core argument – that everyone is entitled to their share of the world’s natural resources – is a guiding light.
Reviewed by Tyler Prochazka and Kate McFarland
Read More:
David Piachaud, “Citizen’s Income: Rights and Wrongs,” Centre for Analysis of Social Exclusion, LSE, November, 2016.
Hilde Latour, “UNITED KINGDOM: David Piachaud Calls Basic Income a Wasteful Distraction from Other Methods of Tackling Poverty,” Basic Income News, February 9, 2017.
Philippe van Parijs, “Why Surfers Should be Fed: The Liberal Case for an Unconditional Basic Income,” Philosophy and Public Affairs, 1991.
John Rawls, “A Theory of Justice,” Harvard University Press, 1971.
John Rawls, “The Priority of the Right and Ideas of the Good,” Philosophy and Public Affairs, 1988.
Ronald Dworkin, “What is Equality? Part 1: Equality of Welfare,” Philosophy and Public Affairs, 1981.
Ronald Dworkin, “What is Equality? Part 2: Equality of Resources,” Philosophy and Public Affairs, 1981.
Ronald Dworkin, “Sovereign Virtue Revisited,” Ethics, 2002.
Main Photo: The photographer reading John Rawls’ ‘A Theory of Justice’, CC BY-NC-SA 2.0 Dana Hilliot
1. A parallel argument, unexplored here, would address the important question of whether employment is voluntary or involuntary. Under most of today’s welfare systems for able-bodied adults, conditionality and sanctions are used to “incentivise” recipients to take up any job available. This threat of destitution has moral implications, in that it calls into question the consensuality of such employment.
2. John Rawls, “The Priority of the Right and Ideas of the Good,” Philosophy & Public Affairs (1988) p. 257
3. At present, incomes generated from natural resources are directly distributed to citizens in only a handful of cases (the Alaska Permanent Fund and Norway oil fund spring to mind). More commonly, states channel incomes from natural resources into the general budget, or such natural resources pass into the realm of private property. While arguments can be had regarding direct versus indirect distribution – whether each citizen gets their share of the windfall directly, or instead indirectly through government spending – that all citizens should benefit in some way seems uncontroversial.
4. Philippe van Parijs, “Why Surfers Should be Fed: The Liberal Case for an Unconditional Basic Income,” Philosophy and Public Affairs (1991), p117
5. For a quick run-down of the problems with equality of welfare, see this summary from the Stanford Encyclopaedia of Philosophy.
6. Ronald Dworkin, “Sovereign Virtue Revisited,” Ethics 113.1 (2002), p111
7. Philippe van Parijs, “Why Surfers Should be Fed: The Liberal Case for an Unconditional Basic Income,” Philosophy and Public Affairs (1991), p124
8. Philippe van Parijs, “Why Surfers Should be Fed: The Liberal Case for an Unconditional Basic Income,” Philosophy and Public Affairs (1991), p126
by Kate McFarland | May 10, 2017 | News
On Tuesday, May 9, an article published in The Independent alleged that Finland’s Basic Income Experiment has already produced evidence that unconditional payments lower stress and improve mental health for unemployed Finns.
This widely shared article generated rumors that the Finnish government has released the first results of this two-year pilot study, which commenced on January 1, including the above findings. These rumors are inaccurate, and the present post aims to address this misconstrual.
Background on Finland’s Basic Income Experiment
Directed by Kela, the Social Insurance Institution of Finland, Finland’s nationwide pilot study of basic income generated widespread international interest from its announcement in 2015 to its launch at the start of 2017. In its current design, the experiment is restricted to those between ages 25 and 58 who were receiving unemployment assistance at the end of 2016. Nonetheless, it differs from several other contemporary so-called “basic income experiments” in that the experimental group–consisting of 2,000 randomly selected individuals from the above target group–receives cash payments (€560 per month) that are indeed unconditional, individual, and not means tested (compare, for example, to the experiments planned or underway in Ontario, the Netherlands, Barcelona, and Livorno, Italy).
Many basic income supporters and followers are, no doubt, eagerly anticipating the results of this experiment, which will continue through December 31, 2018. Here, though, it is important to keep in mind several caveats–especially as rumors of initial results begin to surface.
1. Kela will publish no results prior to the end of the experiment (i.e. December 31, 2018).
In a blog post published in January, in response to the widespread media attention directed at the experiment, research team leader Olli Kangas and three colleagues explain that publishing any results during the course of the experiment runs the risk of influencing participants’ behavior:
A final evaluation of the effects of the basic income can only be made after a sufficiently long period of time has elapsed for the effects to become apparent. The two-year run of the experiment is not very long for changes in behaviour to materialise. The potential of the experiment, short as it is, to provide reliable results should not be undermined by reporting its effects while it is underway.
2. Kela will conduct no questionnaires or interviews of participants while the experiment is in progress.
As the same blog states, the researchers will minimize their reliance on questionnaires and interviews to gain information about study participants–again to minimize the effect of observation on behavior–relying instead on data available from administrative registries. If any individual questionnaires or interviews are used, they “will not be conducted without careful consideration, and not before the experiment has ended.”
3. Analysis of the experiment will focus on labor market effects.
A major reason for the Finnish government’s interest in basic income has been the policy’s potential to improve employment incentives (in contrast to Finland’s current unemployment benefits, which are reduced by 50% of earned income if a recipient takes a part-time job and which demand much bureaucratic oversight of individuals). Correspondingly, a main objective of the experiment, as stated by Kela, is to determine “whether there are differences in employment rates between those receiving and those not receiving a basic income.”
Some basic income proponents have criticized the Finnish pilot for its lack of attention to other potential beneficial effects of basic income, such as its effects on individual health and well-being; however, Kela has no current plans to examine such effects.
“Reduced Stress” Claim
It is in this context that we must read The Independent’s recent article “Finland’s universal basic income trial for unemployed reduces stress levels, says official.”
As its data, the article quotes Kela official Marjukka Turunen (Head of Legal Affairs Unit) as saying, “There was this one woman who said: ‘I was afraid every time the phone would ring, that unemployment services are calling to offer me a job’,” and, “This experiment really has an indirect impact, also, on the stress levels [of people] and the mental health and so on.”
These quotes originate in a recent interview on WNYC’s podcast The Takeaway, in an episode on automation and the future of work, in which host John Hockenberry interviewed Turunen about Finland’s basic income experiment, having presented basic income as a possible policy response to technological unemployment. After stressing the potential of basic income to promote employment (by avoiding the welfare trap and reducing bureaucracy and paperwork), Turunen related the anecdote above in reply to a question in which Hockenberry turned about the effects of basic income on feelings of confidence and self-respect.
In comments to Basic Income News, Turunen explained that this situation involved a participant who agreed to participate in a media interview and volunteered this information to the reporter. While some participants themselves offer feedback to Kela, Kela itself is not allowed to divulge this information to the media, nor to provide any personal information about the study participants. However, this does not prevent participants themselves from volunteering to talk about the experiment to media, as in the present situation.
Thus, it is important not to mistake this unsolicited feedback from experiment participants for official and formal results–which are still more than a year and half away. As Turunen comments,
We do not have any results yet, not until the end of next year; these insights are coming from the customers themselves willing to talk about this in the media. And these are only insights, the results must be very carefully analyzed according to the information we only get at the end of next year.
More Information:
Kela, Basic Income Experiment 2017–2018. (Official website on the experiment.)
Olli Kangas, et al, “Public attention directed at the individuals participating in the basic income experiment may undermine the reliability of results,” Kela blog, January 16, 2017.
“The Shift: Exploring America’s Rapidly Changing Workforce,” The Takeaway (podcast), May 4, 2017. (Marjukka Turunen’s remarks in context.)
Reviewed by Russell Ingram
Photo (Helsinki) CC BY-NC 2.0 Mariano Mantel
