Current Basic Income Experiments (and those so called): An Overview

by Kate McFarland | May 23, 2017 | News

Note: Please see this article for a more current update (Oct 15)

The (Second) Year of the Pilot

Status of Basic Income (and Related) Experiments in May 2017

Last Updated: May 15, 2017

BIEN cofounder Guy Standing, a basic income pilot veteran and now frequent consultant, dubbed 2016 “the year of the pilot“ in response to the burgeoning interest in experimentation with basic income in various countries throughout the world. In 2017, some of these pilot studies were launched, some have been delayed, and other plans have remained dormant. Some have turned out to resemble a full-fledged basic income to a lesser degree than first anticipated.

This page summarizes the current state of this year’s existing, planned, and previously announced basic income pilot experiments (as of May 2017).

A. UPDATES ON SEVEN STUDIES

Following are summaries of the present status (as of mid-May 2017) of seven pilot studies of basic income–or, better put, seven alleged or reported pilot studies of basic income–that have received international publicity within the past year, including projects in Finland, Kenya, the Netherlands, Ontario, Scotland, Uganda, and the United States.

First, though, an important caveat: although each project listed below has been described as a “basic income pilot” or “basic income experiment” in media reports, few manifest every characteristic of a basic income, defined by BIEN as “a periodic cash payment unconditionally delivered to all on an individual basis, without means-test or work requirement.”

Granted, any social policy experiment is by its nature limited in certain ways, making it something of a vacuous criticism to say that a basic income experiment fails to test a “genuine” basic income. While a basic income is lifelong, experiments are necessarily bounded in duration. While a basic income is universal, experiments typically require that a portion of the population not receive the benefit in order to provide a control or reference group. (Even saturation studies, in which every member of a community is eligible for the program, remain limited in that the basic income does not extend to other communities in the same general geopolitical region.)

That said, some of the most highly-publicized experiments and pilot programs diverge from a basic income in ways that are significant even after accounting for inherent constraints due to the nature of experimentation. For example, the target population might not be universal. (As described below, this is the case in the experiment currently running in Finland, as well as those planned in Ontario and several Dutch municipalities and, likely, the experiment under development by Y Combinator.) Additionally, the benefits disbursed to the treatment groups in some of the experiments–such as, most notably, those planned in Ontario and the Netherlands–diverge from some of the key attributes of a basic income, such as by being household-based or reduced with earned income. (As mentioned below, the treatment conditions in the Dutch experiments will even retain a degree of job-conditionality.)

I touch upon additional caveats at the end of this article.

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

Status: Launched on January 1, 2017.

“Rainbow over the Baltic” CC BY-NC 2.0 Mariano Mantel

The national government of Finland has enacted a two-year experiment to investigate the effects of a basic income on labor market participation, designed and directed by Kela (Finland’s Social Insurance Institution). The experimental group consists of 2,000 persons, who were randomly selected from a pool of individuals between the ages of 25 and 58 who were receiving unemployment benefits from Kela in November 2016 (about 175,000 individuals nationwide). Participation in the basic income program was mandatory for those selected.

The 2,000 participants are receiving unconditional payments of €560 (about 590 USD) per month. Unlike Finland’s current programs of unemployment assistance, the pilot program imposes no requirement that recipients demonstrate that they are seeking employment or accept jobs offered to them, and those who do obtain work will continue to receive the full €560. (Thus, while the sample is clearly not representative of all Finns, the individual cash transfers do match the definition of basic income, although not a fully livable one.)

The experiment was officially launched on January 1, 2017–with the first payouts distributed on January 9–and will continue through December 31, 2018.

The research group at Kela will compare outcomes in the experimental group to a control group, consisting of all persons in the original target population who were not selected to participate. As mentioned above, the analysis will focus on labor market participation, including differences in employment rates between the treatment and control groups. Research director Olli Kangas has stated in recent lectures that Kela will also monitor expenditure on medication, health care usage, and income variation.

To avoid observer effects, Kela is conducting no interviews or questionnaires during the course of the experiment, and will publish no results prior to its conclusion at the end of 2018 (despite recent rumors driven by exaggerated claims stemming from a single anecdote voluntarily produced by one experimental participant).

Kangas has recommended expansion of the experiment in future years (e.g. to test different models and broaden the target population); at the time of this writing, however, the government has not acted upon this recommendation.

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

2. GiveDirectly’s Kenyan Basic Income Experiment

Status: Pilot launched in one village in October 2016; full experiment (200 villages) intended to launch in fall 2017.

GiveDirectly, a US-based charitable organization, has initiated a project in which it will eventually provide unconditional cash transfers to the residents of 200 villages in rural Kenya (about 26,000 people in total).

An initial pilot study commenced in one village in October 2016, in which all 95 residents now receive monthly unconditional cash payments of about 23 USD (€21) per month, amounting to roughly half of the average income in rural Kenya. Payments will continue in this village for 12 years. At the time of this writing, only this initial “test village” is receiving a basic income. GiveDirectly’s current objective is to launch its full experiment in September 2017.

Rural Kenya, CC BY-NC 2.0 ViktorDobai

In the full study, 300 villages will be randomly assigned to one of four groups: three treatment groups, in which all residents receive some form of unconditional cash transfer, and a control group of villages in which no cash transfers are given to any residents.

In the first treatment group, which will include 40 villages, residents will receive cash payments of about 23 USD every month for 12 years (as in the initial test village). In the second, containing 80 villages, residents will receive monthly cash payments of the same amount, but only for two years. In the third, also containing 80 villages, residents will receive a lump-sum payment equal in amount to the two-year basic income. (Note that, ignoring their time-boundedness, the schemes implemented in the first two treatment groups do meet BIEN’s definition of ‘basic income’.)

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 also indicates that it will investigate outcomes including “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 is making much of its data public as it collects it (e.g. responses to the first survey of participants in its initial pilot); this practice, however, pertains only to the pilot village, which is not itself to be included in the full experiment. The organization expects to publish its first experimental results after one or two years.

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

3. Ontario’s Guaranteed Minimum Income (“Basic Income”) Pilot

Status: Pilot studies scheduled to commence in two regions in spring 2017, and in a third region in autumn 2017.

Lindsay, Ontario, CC BY 2.0 RichardBH

The government of the Canadian province of Ontario is preparing a three-year pilot study of a guaranteed minimum income (commonly called in a ‘basic income’ in Canada), which will take place in three locations: the Hamilton, Brantford, and Brant County region (launching in late spring 2017); Thunder Bay and surrounding area (launching in late spring 2017); and the city of Lindsay (launching in autumn 2017).

A total of 4,000 potential participants will be randomly selected from a pool of low-income adults between the ages of 18 and 64 years who have lived in one of the three test locations for at least one year. Participation is voluntary, and those who do agree to participate in the experiment may exit at any time during the study.

Study participants will receive a minimum annual income of 16,989 CAD (€11,340) for single individuals and 24,027 CAD (€16,038) per year for couples. That is, individuals and couples with no external income would receive this amount of money. For participants who to earn additional income, the amount of the benefit will be reduced by the amount of 50% of earned income (entailing that, for example, single individuals will stop receiving any payment if their income rises above 48,054 CAD per year). Individuals with disabilities will receive an additional amount of up to 500 CAD (€334) per month.

The benefit is not contingent on work or looking for work. However, because the amount of the benefit depends on income and household composition, and because eligibility for the study is limited to low-income individuals, the program to be tested in Ontario is not a basic income in BIEN’s sense. (As mentioned above, the term ‘basic income’ is often used in Canada to refer to guaranteed minimum income programs, in contrast to the definition adopted by BIEN and common in Europe. The Ontario government is not being sloppy or dishonest in titling the program ‘Basic Income Pilot’; mere dialectical differences explain the ambiguity.)

According to the Government of Ontario website, the experiment will measure 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. A third-party research group will evaluate data collected during the pilot.

Results of the pilot will be reported to the public in 2020.

Official site for more information: www.ontario.ca/page/ontario-basic-income-pilot.

4. Municipal Social Assistance Experiments in the Netherlands

Status (July 2017): Six municipalities approved to proceed with two-year experiments, which will begin in Sep-Oct 2017; applications from Utrecht and Amsterdam currently under review.

In 2016, research teams in several municipalities in the Netherlands developed plans to experiment with unconditional cash transfers to replace the nation’s workfare-oriented program of social assistance. However, their plans encountered resistance from the national government, which imposes constraints upon–and, in effect, prohibits–experimentation with unconditional benefits. (For example, the Dutch Participation Act would require that experimental participants be surveyed after six and twelve months to verify that they have made sufficient efforts to find work, and dropped from the study if they have not–effectively removing the “unconditionality” of the benefit.)

A pilot proposed in Utrecht, which had gained the lion’s share of attention in the English-language news media, has been delayed after the government failed to authorize the experiment as designed by the Utrecht University research team.  

Groningen, CC BY-NC-ND 2.0 Emmanuel Fromm

On July 3, 2017, the Dutch Ministry of Social Affairs authorized experiments in the first five municipalities: Groningen, Wageningen, Tilburg, Deventer, and Ten Boer (read more). Groningen and Ten Boer will be working in collaboration.  

A similarly structured experiment in Nijmegen, which is to involve 400 participants, was also approved later in the month.

In contrast the previously rejected design of an experiment for in Utrecht, the designs of the latter experiments were deemed to be in compliance with the requirements of the Participant Act. For example, each includes a treatment group in which participants are subject to workforce-reintegration requirements that are more intensive than current welfare programs.

In each of the experiments, which will run for two years, participants will be randomly selected from a pool of current social assistance beneficiaries (with participation voluntary for those selected), and assigned either to a control group or to one of several treatment groups.

Each experiment has at least three treatment groups, testing the following types of interventions: (1) removing reintegration requirements (e.g. job applications and training programs) on welfare benefits; (2) providing a more intensive form of reintegration service; (3) permitting participants to earn additional income on top of their welfare benefits. Subjects assigned to the third treatment groups will be permitted to retain 50% of additional earned income, up to a maximum of €199 per month, for the duration of the two-year experiment. In contrast, under current policy, welfare recipients 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.

It is not fully accurate to refer to the Dutch municipal experiments as tests of basic income. None includes an experimental condition in which the amount of the benefit is fully independent of either income or household composition (the existing benefits are household-based, which is not to be altered in any of the proposed experiments). Further, none of the proposed experiments includes a treatment that combines a reduction in the withdrawal rate of benefits with a removal of work-related conditions. And, as mentioned above, even those subjects who receive the “unconditional” payments will be subject to removal from the study after six or twelve months if they fail to seek work.

Researchers plan to examine outcomes such as employment (including part-time and temporary employment), education, and health and well being.

5. Eight’s Unconditional Cash Transfer Project in Uganda

Status: Launched on January 1, 2017.

In January 2017, Eight, a charitable organization based in Belgium, began disbursing unconditional cash payments in the Ugandan village of Busibi. All residents of the village, including 56 adults and 88 children, receive monthly cash payments, distributed via mobile phones. Each adult receives 18.25 USD (about €16.70) per month, approximately 30% of the average income of lower-income families in Uganda, and each child receives half of this amount, or 9.13 USD per month. The payments will continue through the end of 2018.

Used by permission of Steven Janssens

Eight is working with anthropologists at Belgium’s University of Ghent to examine outcomes along four main dimensions: girls’ educational achievement, access to health care, entrepreneurship and economic development, and participation in democratic institutions. Researchers will compare data collected during and after the pilot to data that were gathered before its launch. However, no additional village is being studied as a control, limiting the project’s usefulness as an experiment.

That said, Eight’s project has objectives beyond research. It is also the basis of a documentary, the first segments of which have already been release, and cofounder Steven Janssens has emphasized its larger purpose to inform future basic income projects: “From our experiences with this pilot we will learn and adjust where necessary, because in the long term we want to scale-up to more villages as our organization grows.”

Official site for more information: eight.world.

6. Y Combinator’s US-Based Unconditional Cash Transfer Study

Status: Design phase; no known launch date.

Sam Altman, CC BY 2.0 TechCrunch

In early 2016, Silicon Valley tech entrepreneur Sam Altman decided to pursue a privately-funded basic income experiment, motivated in part by the goal of moving away from a focus on employment effects and examining potential benefits of a basic income more holistically. To this end, he founded a research group at his company Y Combinator to design and implement the project.

In a February 2017 talk at Stanford, research director Elizabeth Rhodes explained that Y Combinator’s pilot is still in the design phase. As currently planned, it will use a stratified sample of 2,000 to 3,000 individuals from two states, between the ages of 21 and 35, with household incomes below the median in their area. At least 1,000 of these study participants will be randomly assigned to the treatment group, in which they will receive 1000 USD (about €915) per month for three years (with a subset receiving the payments for an additional two years). The payments will be given unconditionally and irrespective of income. The remainder of the sample will provide a control group.

The research group is also still in the process of developing metrics to evaluate the experimental results. However, Rhodes has indicated that experimenters are interested in a holistic evaluation of individual-level outcomes such as labor market participation, training and education, time spent with children, physical and psychological health and well-being, risk-taking, financial health, and help given to friends and family. Outcomes related to the children of participants (e.g. grades and test scores) might also be examined.  

Y Combinator’s “pre-pilot” in Oakland, announced in May 2016 to media acclaim, is not itself an experiment; its purpose is merely to help the research team fine-tune its methods and procedures (selection of subjects, disbursement of payments, collection and recording of data, etc.).

7. Scottish Municipal Experiments

Status: Feasibility studies in progress.

Glasgow Bridge, CC BY-NC-ND 2.0 Colin Campbell

In Glasgow, Scotland, the City Council has partnered with the think tank Royal Society of Arts (RSA) to investigate designs for a basic income pilot. The planning process, while moving forward, is at an early stage in development, with the Council and RSA currently working on a study of the financial, administrative, and constitutional feasibility of the pilot. Workshops on these topics will be held in June and July 2017, and a report is planned for September.  

The Councils of Fife and North Ayrshire have also committed to investigate the possibility of conducting basic income experiments.

B. OMISSIONS AND FURTHER CAVEATS

Avid followers of basic income news (including Basic Income News) might have noticed that some previously announced pilots and experiments have been omitted from the above list.

Oversight, of course, is a possible cause: if a current or planned basic income experiment is missing from this page, please submit it to our Submit a News Lead form.  

In some cases, though, apparently omissions may be intentional. Sometimes “basic income experiments” are announced in the media (1) prematurely, (2) when the experiment is not actually testing a basic income, or (3) when the project is not an experiment:

1. Not all previously announced pilot studies have come to fruition. For example, contrary to claims promulgated in news media and social media in recent months, neither the Office of Financial Empowerment of San Francisco, California nor the provincial government of Prince Edward Island, Canada is pursuing a pilot study of basic income at this time (primarily due, in both cases, to failures in attempts to secure funding for the experiments).

India has also occasionally been cited as a location about to launch a new basic income pilot study–or even about to implement a full-blown basic income policy (see the response in Basic Income News to rumors that circulated at the start of the 2017). To be sure, the national government of India has shown considerable interest in universal basic income, devoting an entire chapter to the topic in the 2017 Economic Survey, an annual document prepared by the Ministry of Finance. India is also notable in the basic income community for the success of previous basic income pilot studies. At the time of this writing, however, no firm plans for additional pilot studies (let alone a full-blown policy) have been announced, and any popular media reports of new pilot studies in India remain speculative and premature.

In general, one should be wary when the popular media announce the impending launch of a basic income experiment. Such announcements often frame the prospective studies as far more certain–and farther along in the planning process–than they actual are. Researchers and governmental officials might indicate interest in running an experiment prior to attempting to obtain funds or examining the legality or feasibility of the project, and sometimes such expressions of interest capture the ears of the media. Of course, such tentative interest does not entail that an experiment will ever actually manifest.

2. I have raised the second issue–the fact that many so-called “basic income pilots” or “basic income experiments” diverge substantially from tests of a genuine basic income–at the start of this article, and we have already seen examples above (including the Dutch social assistance experiments and the Ontario pilot).

Due to their relative lack of attention in popular media, I have not included reference to other social assistance experiments that have, on occasion, been inaccurately called “basic income experiments” — including those in Barcelona and the Italian town of Livorno. About the latter, a six-month social assistance experiment, BIEN-Italia’s Sandro Gobetti has clarified in Basic Income News, “Among the requirements [for participation in the experiment] was residency in the municipality for at least five years, unemployment status, registration at the employment center and a family income not exceeding €6530 gross per year. In exchange for €500 monthly, the municipality invited successful applicants to perform socially useful work.”

3. Finally, note that several non-profit organizations have launched projects that involve the distribution of unconditional cash transfers to individuals, but that are not experiments (although, in some cases, they might still be called “pilots”).

For example, Brazil’s ReCivitas raises money to distribute unconditional cash payments of 40 Brazilian Reais (about €12 or 10 USD) per month to residents of the village of Quatinga Velho, Brazil. In January 2016, the organization announced that the monthly payments would be lifelong, and began distributing the payments to an initial group of 14 individuals. However, the ReCivitas Institute is not gathering data to study the effects of basic income. Project leaders have stated that they are already convinced that basic income is effective, and that their goal is to provide a model and inspiration to other similar initiatives. The initiative might be considered a pilot, insofar as it is intended to provide information about how NGOs have effectively implement a basic income scheme; however, it is not an experiment.     

Lottery programs that award selected individuals their own “basic income” for some length of time, such as Germany’s Mein Grundeinkommen, are also not experiments and should not be classified as such.

Most recently, a newly launched film project in the United States, Bootstraps, has begun raising money for what it calls a “basic income pilot program”. This effort also appears not to be an experiment but, instead, a similar lottery-style program, intended to generate anecdotes, publicity, and awareness of the idea of basic income rather than robustly test its effects.

Reviewed by Tyler Prochazka. Some additional proofreading by Karl Widerquist, May 25, 2017

Cover Image: CC BY-ND 2.0 iT@c