by Hannah Trippier | Sep 13, 2018 | News, Research
The International Monetary Fund (IMF) has published a report suggesting that basic income would be better than their welfare system at supporting low income households in India. Similar evidence has been found for both Indonesia and Peru, where basic income was found to be beneficial compared to current welfare systems.
The report uses 2011-12 National Sample Survey data to analyse the Public Distribution System (PDS) in India, where subsidies for food (wheat, rice, sugar) and energy (kerosene) are provided at different levels according to a person’s position in relation to the poverty line. This welfare system was found to be both inefficient, with leakage in the procurement-transportation-distribution chain, and inequitable, in that around 20% of low income households do not receive any subsidy
The analysis compared PDS to a model of basic income. Their analysis found that a basic income outperforms PDS in terms of coverage, as basic income is universal. However, the analysis showed that the introduction of basic income would mean reduced targeting and generosity for lower income groups. At the lower end of the income scale, some households will gain in terms of relative benefits, whereas some will lose out. In the bottom decile the analysis found a greater share of losing households (58% losers compared to 42% gainers).
The authors noted that basic income would bring about a benefit in eliminating current operational inefficiencies in the PDS. They suggested that savings from this could be used to fund a more generous basic income that could mitigate the losses in lower income deciles. They ran another analysis with a higher basic income and found a greater share of gainers than losers in the bottom decile (60% gainers compared to 40% losers), suggesting a higher basic income would be more beneficial for this group. Alternatively, the authors also discuss the possibility of introducing additional programmes for households in this group, to supplement basic income and ensure they do not lose out.
More information at:
David Coady, Delphine Prady, “Universal Basic Income in Developing Countries: Options, and Illustration for India”, IMF Working Papers, July 31st2018
Rema Hanna, Benjamin A. Olken, “Universal Basic Incomes vs. Targeted Transfers: Anti-Poverty Programs in Developing Countries”, National Bureau of Economic Research Working Paper Nº24939, August 2018
“Debate over universal basic income steps up as IMF weighs impacts”, Development Pathways, August 14th2018
“Growing debate around universality” sees diverging estimates of basic income”, Development Pathways, September 3rd2018
by Andre Coelho | Jul 7, 2018 | News
Muhammad Yunus. Picture credit to: Yunus negócios sociais (Brazil)
Muhammad Yunus, the 2006 Peace Nobel Prize laureate and founder of the Grameen Bank, is very concerned about artificial intelligence (AI). His fear revolves around the prospects of generalized unemployment, as machines replace most of traditionally human tasks.
Yunus also, like a few other economists, including Nobel Prize winners, has reached the conclusion that one of the downsides of AI is the devaluation of the human being, in relation to machines. This, he argues, will take away the ability of many people, even more than today, to care for their own basic needs. Hence, Yunus concludes, a universal basic income must be implemented now, before artificially intelligent algorithms start treating human beings as if they were “cockroaches”.
He also calls for legislation which can circumscribe AI’s intervention in society, recalling that guidelines exist for many other aspects of our reality, such as medicine, food, engineering, and so on. That would not be a deterrent to the development of novel AI applications, but only the introduction of safety mechanisms that would prevent AI creations from killing people, or making decisions for them abusively, for instance. If humans have created these technologies, then humans can, and should, direct them to socially positive goals, such as healthcare.
According to Muhammad Yunus, basic income will be an important means to bring out the natural entrepreneur in every human being. Humans can and will do many things, given the right conditions. Yunus is convinced, and his Grameen Bank stands out as proof, that people need not be “mercenaries of the whole system”, and that schools should create “life ready” young people, rather than “job ready” ones.
More information at:
Sangeetha Chengappa, “It is time to introduce Universal Basic Income, says Nobel Peace laureate Muhammad Yunu”, The Hindu Business Line, July 2nd 2018
Kate McFarland, “SCOTLAND, UK: Nobel-winning economist Joseph Stiglitz cautions again Basic Income during BBC interview”, Basic Income News, November 8th 2017
Kate McFarland, “Nobel Laureate Economist Augus Deaton endorses basic income”, Basic Income News, May 18th 2016
by Guest Contributor | Apr 23, 2018 | Opinion
Sarath Davala is an independent sociologist who, along with Guy Standing, was the architect of a series of UNICEF-backed basic income pilots in Madhya Pradesh, central India. Inspired by the findings of that study, he became the co-founder and coordinator of the India Network for Basic Income.
The Basic Income Asia Pacific 2018 conference held in Taipei this March featured a host of speakers from around the world, including Davala. I got to sit down with Davala at National Taiwan University to talk about his research and the applicability of basic income to Asia. The following transcribed interview has been lightly edited.
Please talk about your research in India, and how it has led to your support for UBI as policy.
Between 2011 and 2013, a women’s trade union called the Self Employed Women’s Association conducted an experiment in Madhya Pradesh. I was heading that research project and Guy Standing was supporting as the main principal researcher. Now that study where we gave unconditional basic income to 6,000 people living in nine villages came out with findings which were startling and surprising. Because at the time people believed – the government said, the bureaucrats always said, and everyone in the middle-class believed – that if you give money to people without any conditions, they will not use it for good purposes but bad purposes, like drinking alcohol and other things. But we found that many positive things have happened in all these villages. Particularly, the most vulnerable in society benefited the most.
That gave us the conviction that UBI is a very good policy. It need not replace everything (to say that only UBI should be there), but when you are designing or redesigning your welfare basket for your nation, you must have this as the foundation, where everybody gets a certain basic amount of money, and on that they build a life. UBI can be a foundation on which the market or the government, can actually build your life. So that is how research comes into policy.
Could you talk about the process in which you made the Madhya Pradesh basic income pilots a reality? How did you gain the support of local government?
We didn’t ask the local government for money, that’s the important thing. We asked a variety of people, but finally UNICEF agreed to give us the money. It was not a small amount of money, almost a million US dollars. That was required because we were giving cash to people.
Everyone is in process of searching for alternatives, even the government, because the existing system is not delivering the welfare properly, effectively. So we said [to the government], “here’s an alternative, please join us, listen to us, once every three months we will come talk to you.” So that, when we finally come out with the findings, the government said “Oh yeah, we know these guys, they’ve been doing this work.”
So that was one reason, we followed up with policymakers. But at the same time, the other reason was we needed local support. Because if you go to a village and say you want to distribute cash, the local politicians and media will be a problem. So we had the friendship of the government, the trade union which was working in the area, and international experts like Guy Standing. With this kind of combination, we have been able to roll out a study.
Did you encounter any challenges in implementing the basic income experiment on the ground?
A variety of challenges. Even in 2010, when somebody told me they have a project like this, asking “would you like to head this project?” I said “What? Giving money to people? Without any conditions? I always suspected you were mad but now it’s confirmed.” I thought it was crazy.
Similarly when you go to the villages, and say “we want to give cash to everybody for one year.” They say, “what kind of crazy fellow you are!” There’s a lot of disbelief, but also lots of suspicion, that “you guys have something else in your mind and you are going to cheat us, you are taking our consent signatures, maybe you will use our signatures to grab our lands.” People were suspicious about our motives. But then it took us a long time to bring everybody inside. There were 10 percent of the people who rejected the process. But then, women from those rich households said, “no, no. We want to be part of it. You are conducting training programmes and opening bank accounts. We don’t have bank accounts.” So they were interested.
In your presentation earlier, you talked about how it’s important to consider Asia’s local context. You have also worked with Guy Standing, who coined the term, an emerging socioeconomic class, the “precariat.” Do you think the concept of “precariat” is applicable to the situation in developing countries, or is the “precariat” more particular to developed societies?
No, no no. The precariat is everywhere. The percentage will change [depending on the economy], but the percentage is increasing. In fact, earlier the precariat was at the bottom, but even if you go to the high end jobs, you realise that the contracts are very fragile. Today you are there, tomorrow you can be given a pink slip: “okay, you are no longer needed.” Of course, the precariat is there in developing countries, but also every other country.
You want to deny that there’s a precariat, it’s up to you. But if you want to see, there is precariat. Who is the precariat? Precariat is that class of people whose basis of livelihood is very precarious. Today it is there, tomorrow it is not. And they can turn anywhere. That’s why Guy Standing says it is the most dangerous class. They can turn into anything, into crime, into drugs.
Speaking of the Asian context, would you say Asia is particularly vulnerable to the coming wave of automation?
Which economies are more vulnerable to automation and which are not? Within India, automation will affect maybe small section of the industrial manufacturing sector and the software industry. But because of the surplus cheap labour available in India, most of the entrepreneurs will bank on cheap labour.
So for India, I do not see the threat of automation, but it is possible in Taiwan. You are going to have your first automated 7-11? If that is profitable, more and more Family Marts, KFCs, McDonalds may switch their outlets. At the end of the day, an entrepreneur is looking at costs. And human beings are so difficult to manage, every entrepreneur will say. I taught human resources courses in a business management school for seven years. Every businessman is trying to get rid of them.
In your presentation, you talked about how the Indian government has been reducing the welfare state and pushing responsibility to the family and the market. In this context, do you think UBI is a way for governments to reject its responsibility as the welfare state to provide more social services?
Absolutely. Every government in the world is under pressure now. They are under pressure in order to pursue economic growth. They think if economic growth is there, everything will be alright. Under those pressures, they want foreign investment to come in, they want multinationals to establish units in their countries. So they want economic activity in their country, so they’re doing a variety of things with other nations, particularly the richer ones. They’re under tremendous pressure.
When those pressures are there, governments are trying to reduce their responsibility to the people. It’s our job as civil society that we have to keep reminding government that “this is your minimum responsibility. If not in that way, then you should do it this way.” We are saying that, in the welfare basket, UBI is a foundation, the primary thing. On top of it, we can put additional various other things. So that should be the new design. We are making a new design of the welfare basket, trying to propose to the government “in all circumstances you must do this. Don’t throw us into the market, and don’t throw us into the family,” because everyone in the family is in a precarious position. We have to force the government to implement basic income, because that gives basic security to everyone.
Any other comments?
I think there is great promise in the group steering the UBI Taiwan movement. I wish everyone in UBI Taiwan great success. To all the readers, please join and strengthen the movement, because we are definitely making history.
Interviewer: Shuhei Omi, Writer for UBI Taiwan
by Tyler Prochazka | Apr 4, 2018 | Opinion
The Basic Income Asia Pacific 2018 conference signaled a feeling of growing momentum of the basic income movement in Asia Pacific, particularly in Taiwan.
Over 100 attendees filled the two day conference in Taipei, along with thousands of viewers of the online livestream and simultaneous translations. The speaker roster this year featured an extensive list of international and Taiwanese scholars and personalities.
Enno Schmidt, the 2016 Swiss referendum leader, and Sarath Davala, the leader researcher for UNICEF’s Indian basic income trial, led the keynote speeches for day one and day two respectively.
Davala said he felt “electricity” during the conference.
“The UBI Asia Pacific Conference is an important milestone in the basic income movement. It is a high voltage moment that we in Asia will talk to our children about. The energy in the conference was amazing, and I was inspired to see young women and men from different universities in Taiwan all fired up about the idea of basic income,” Davala said.
Schmidt said it was clear the Taiwanese group had put in a lot of effort since last year’s conference.
“At this year’s UBI Asia Pacific Conference, it was noticeable that the UBI team had already been working for a full year. Sarath Davala from India gave a rousing speech, and Patrick Havermann from the United Nations Development Program in Asia would like to make the entire UN network available to spread the idea of the Basic Income,” Schmidt said.
Taiwanese media emphasized the conference’s focus on Taiwan’s recent changes to the referendum law, which has opened up the possibility for a basic income referendum in Taiwan.
Taiwan’s Digital Minister Audrey Tang opened the first day of the conference, noting that while she believes more research should be done on basic income in Taiwan, she supported the spirit of discussion at the conference.
“Indeed, to build a sound re-distribution mechanism to improve human welfare and equality — this is a timeless subject that needs continuous review and revisit,” Tang said.
The UN Development Program (UNDP) Asia Pacific Advisor Patrick Haverman, who has been leading an effort to work with regional governments to research basic income, opened the second day of the conference.
Haverman held a series of round-table discussions with Chinese scholars and officials on the possibility for a pilot program in China.
“In my work with UNDP, I have helped establish round-table meetings on basic income across the Asia Pacific with other UN agencies, academics, and government officials to start a discussion about UBI and explore the possibility of piloting an basic income project,” Haverman said. “The Basic Income Asia Pacific conference is good way to exchange information and to discuss how potentially UBI can address some of the most pressing challenges of our time, like inequality and automatization potentially taking over some of the current jobs.”
UBI Taiwan also presented the current state of their research on both days. The research group said their main focus is creating a framework for a universal Partial Basic Income (PBI) that would gradually phase into a full basic income over a decade. The English overview of their research can be found here.
The proposal would increase taxes by five percent of Taiwan’s GDP and could provide 3,000 NTD ($102 USD) to every Taiwanese citizen.
Jiaguan Su, UBI Taiwan’s Research Director, said the scholars who had met with the research team to discuss the national proposal were “impressed,” and that their main takeaway is that the proposal must emphasize the values of UBI.
“The most important lesson we took from the conference is we must promote the core values of UBI Taiwan through the national proposal. Namely, UBI is for everyone, not just a specific group of people. Our research should focus on this value in order to demonstrate UBI’s ability to promote democracy and human rights in Taiwan,” Su said.
Jason Hsu, a KMT (Nationalist Party) legislator in Taiwan’s Legislative Yuan, spoke at the first day of the conference. Taiwan media reported that Hsu is considering raising the subject of basic income with large Taiwanese companies.
James Davis, a Columbia University student and UBI Taiwan Field Research Director, interviewed Andrew Yang, the 2020 US presidential candidate running on a basic income platform for the conference. Yang is ethnically Taiwanese and said he was excited by the discussion of basic income in Taiwan.
“UBI Taiwan is fighting the good fight. I was honored to contribute to the BIAP conference because job automation has the potential to seriously hurt Taiwanese workers – and American workers – if universal basic income doesn’t become a reality soon,” Yang said.
Davis also interviewed Qin Gao for the conference, the Columbia University professor who has written a book on China’s cash transfer program, dibao. Gao is the director of China Center for Social Policy at Columbia. Gao noted the problems and stigmatization that arise from some of the means-testing conditions on China’s cash program.
Andy Stern, the former President of the Service Employees International Union (SEIU) and former advisor to President Barack Obama, has been a consistent advocate of basic income in the United States and has provided advice and support to UBI Taiwan over the last several months.
“The clarity of UBI Taiwan’s vision and the tremendous work of its fellows is astounding. The time for universal basic income policies is now, not later. And the world is lucky to have UBI Taiwan on the vanguard of the global debate, designing UBI policy in practical, politically feasible ways,” Stern said.
National Chengchi University (NCCU) and National Taiwan University were the locations for the event this year. NCCU’s International Master’s Program in Asia Pacific Studies (IMAS) was the main organizer for the event. UBI Taiwan provided the volunteer team.
The U.S. State Department’s Critical Language Scholarship program provided a grant through its Alumni Development Fund to support the event to Prochazka, Elyse Mark, and Davis.
Tyler Prochazka, UBI Taiwan’s co-founder, was the director for the conference along with Dongyan Wu, UBI Taiwan’s Public Relations Director. Prochazka and Wu will appear on Taiwan television in April and May.
Ping Xu, UBI Taiwan’s co-founder, said she was excited by the results of the conference, particularly the connections made between different opinion leaders from around the region and within Taiwan.
“It was great success to have many influential opinion leaders from political, medical and social fields participate in the conference. This was a brand new milestone to help build the UBI movement in Taiwan,” Xu said.
Davala said the conference was a positive sign for the future of Taiwan’s UBI movement.
“UBI Taiwan, within a short period has been able to inspire and mobilize hundreds of students to stand up for an idea that is often dismissed as Utopian and impractical. Taiwan could very well be the first Asian country to go for a referendum on Unconditional Basic Income,” Davala siad.
The livestreams and simultaneous translation broadcasts can be found on UBI Taiwan’s Facebook. For the conference’s Twitter stream, go here.
by Andre Coelho | Apr 2, 2018 | News
Saksham Khosla, a research analyst at Carnegie India, has written a detailed report on the implementation of basic income in India. His research focuses on the political economy of administrative, economic and welfare reforms in India.
Less than a year ago, India’s Finance Minister, Arun Jaitley, presented the Indian government’s Economic Survey, which featured a 40-page chapter on basic income and its implementation in India. Khosla report now comes and offers path onward, recognizing the previous survey achievements and limitations. Briefly reviewing the Economic Survey and its features, he writes that “the survey’s central design features offer a weak foundation”, and that if not subject to a deeper analysis and debate it “will produce underwhelming results”.
The new report calls for a basic income trial in India (or several trials, as presently the case in the Netherlands). The rationale behind this assertion is that hard evidence is crucially needed, so the discussion can move “from academic conferences and opinion pages into parliamentary debate and legislation.” However, it warns about the relevance of such trials, arguing that none can be achieved without strong public support and clear economic fundamentals. It also notices that cutting through all existent social programs, although most being inefficient and expensive to administer, could “turn quickly from manna from heaven to actively undermining the Indian social contract”.
Finally, Khosla report also acknowledges the importance of developing and enhancing the recently deployed Aadhaar authentication system, plus other initiatives to boost digital payments and further financial inclusion, which, apart from the political and tax collection problems still to resolve, are key to a future basic income implementation in India.
More information at:
André Coelho, “INDIA: Finance Ministry debating UBI proposal from Economic Survey”, Basic Income News, July 4th 2017
Kate MacFarland, “INDIA: Government Economic Survey presents case for basic income“, Basic Income News, February 4th 2017
Saksham Khosla, “India’s Universal Basic Income: bedevilled by the details”, Carnegie Endowment for International Peace, 2018
