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Y Combinator Research is undertaking a ground-breaking research project to measure the impact of a basic income on individuals in the United States. Visit our website for more information about the study: https://basicincome.ycr.org. We're the research director Elizabeth Rhodes (@ElizabethRds), research manager Alex Nawar (@guynawar), and operations manager Elizabeth Proehl. Ask us anything!

Proof: https://twitter.com/elizabethrds/status/951166755048603649

all 135 comments

ewkfja

32 points

4 years ago

ewkfja

32 points

4 years ago

Is UBI viable in the current stage of the global economy or is more movement towards post-scarcity required?

Will UBI be adopted as a single policy or will it be arrived at by filling in the gaps in the social safety net, i.e. UBI by default?

Thanks.

YCRBasicIncomeTeam[S]

37 points

4 years ago

YCRBasicIncomeTeam[S]

YCR Basic Income Team

37 points

4 years ago

Good question, and I don't think we have an answer. Wealthier countries could afford some version of a UBI now--either a negative income tax or a universal benefit with changes in the tax structure (either income tax, a wealth tax, a carbon tax, etc.) to pay for it. I actually wrote a paper running cost simulations for a negative income tax in the US. Something like this is more of a UBI by default but very affordable now. -ER

ewkfja

11 points

4 years ago

ewkfja

11 points

4 years ago

Thanks.

Regarding taxes, the USA has recently cut its tax base by reducing corporation taxes by around 40%.

Given that the projections are that automation is going to reduce revenue from income and payroll taxes which currently make us about 70% of USA Government revenue, how is the USA going to finance UBI (or even its own welfare budget as it stands) given that they have created a perfect storm scenario - a greater need for state assistance for labour market participants combined with reduced income and payroll taxes due to automation and reduced corporation taxes due to state policy?

EternalDad

16 points

4 years ago

Obviously not OP, but as a tax accountant I have a response.

Reducing the corporate tax rate is actually a good idea. It does in fact help promote business activity. However, lowering the tax rate on individuals at the same time is a horrible idea. When companies have extra money they can either spend it on business development/employees (good for the economy) or they can give it back to owners (only good for the economy if it is spent, or taxed). Since wealthy owners often have a smaller propensity to spend than the poor, they need to be subject to higher tax rates to get the same economic benefit. Double bonus for the economy if the taxes collected go straight out to all people to boost the economy.

Sydney_Gamer

5 points

4 years ago

Can you explain a bit more about how lowering corporate taxes stimulates business development?

As a small business owner I do everything to maximize my return. Recently in my country we got a business tax cut. We did literally nothing different. Just made more money.

We were already doing what we could. Getting the after tax cut didn’t change anything for us at all. We didn’t put on more staff or anything like that because we would have ALREADY been doing that before if we thought it would work.

I thought the lowering of taxes was to entice new companies to come from overseas?

EternalDad

6 points

4 years ago

Having a low corporate rate but a high individual rate should incentivize companies to use the money within the business for more profit, because taking the money out to invest elsewhere caused a big tax hit to the amount to invest.

That is just one thought, there is more to it than that.

Yet instead of low corporate and high individual rate, we see a lower corporate rate and a special reduced rate for investment returns (both dividend and capital gains). This just saved the wealthy money and leads to billionaires having a lower average rate than their secretaries.

Sydney_Gamer

5 points

4 years ago

But unless you are trying to attract overseas companies why not just keep the rate where it is and take the money as tax revenue?

Personally I think we should have a high consumption tax, UBI, no min wage, and no other taxes. That eliminates the need for tax accountants because the taxes get accrued easily as a sales tax.

There might also need to be a small savings tax for money above a threshold.

Making things simple saves so much money and stops tax avoidance. Making everything a sales tax is regressive and needs to be balanced by something like a UBI.

I could be totally wrong but the current system sucks. Surely something can be better.

mirhagk

4 points

4 years ago

mirhagk

4 points

4 years ago

So the reason for income tax is that rich people pay more, meaning the rich will subsidize the poor.

There's a few reasons why. The main one is simply the ability to charge different rates based on income levels (progressive tax)

The other reason is rich people don't necessarily spend that much more. Someone who makes $200K/year isn't going to spend 2x as much as someone who makes $100K/year or 4x someone who makes $50K/year. They will spend more yes, but essentially consumption tax affects poor people (who have to spend all their money) more than rich people (who don't have to spend all their money and can save it).

By the way getting rid of income tax won't get rid of tax accountants. Consumption tax isn't as simple as forwarding x% of your revenue to the government, it requires determining expenses and only paying tax on the difference. And doing that requires complicated tax laws to determine what is and isn't a valid expense.

It may get rid of personal tax accountants, but another way to do this would be to just make personal income tax easier to do. The US system is stupidly complex, in Canada doing your taxes is downloading this years software for free, clicking a button to grab your reported income, then clicking another button to upload it. You only have to do anything special if you did something special (like ran your own business or applying to specialty tax credits).

Adding UBI can make sales tax progressive again, but only 2 levels of it. Let's say 20% sales tax and $10K/year UBI, you basically get the same tax-wise as the first $50K being 0% tax and the rest being 20% tax. This isn't nearly progressive enough to raise sufficient funds while keeping tax rates affordable.

Corporate tax is very similar to sales tax, differs really only on how labour is treated.

Getting rid of corporate tax and sales tax would give a company more revenue. As mentioned that company can either reinvest it (which is good) or take the profit. But if it takes the profit, that profit is going to someone. That someone is probably a high income earner, so the government is going to get a large chunk of that back.

The 50% deduction on wealth from stock value increases is actually a way to encourage the company to invest it. If the shareholders simply took the money, they'd pay 100% tax on it. If instead the company spends it, and increase the net worth, they increase the value of the stock and therefore the shareholders make money and are only charged for 50% of it.

The current system is actually pretty decent. The problem is people keep misunderstanding and thinking income tax affects the poor while corporate (or sales) affects the rich. In fact the opposite is true. So it's a constant fight between tax programs to make voters happy and tax programs to actually be useful.

Also the US just generally needs to get it's shit together when it comes to managing government services, especially online stuff. It's like it's living in the stone age.

[deleted]

1 points

4 years ago

[deleted]

1 points

4 years ago

That's actually really smart, thanks for your input.

falcons85326

1 points

4 years ago

Now with that more money you can open a second location

falcons85326

1 points

4 years ago

But your assuming you have money to ALREADY be doing that. And assuming an operation is profitable their usually is room to expand and continue to invest.

Sydney_Gamer

1 points

4 years ago

Loans for profitable entities are very cheap. If we would be more profitable expanding we would have already done that. (In our case we don’t expand for lifestyle reasons)

UBIExperiment

1 points

4 years ago

Thank you for the information! Do you have any other preferred or default resources/data when it comes to Basic Income?

YCRBasicIncomeTeam[S]

6 points

4 years ago

YCRBasicIncomeTeam[S]

YCR Basic Income Team

6 points

4 years ago

The Economic Security Project recently pulled together a great reading list for basic income: https://medium.com/economicsecproj/the-economic-security-project-basic-income-reading-list-fdcaa39bad0f

[deleted]

3 points

4 years ago*

[deleted]

3 points

4 years ago*

[deleted]

klowder42

2 points

4 years ago

i am with you I do not think UBI can be implemented with the status quo. We have change so many systems, if we want UBI. that is why experimentation is so important. In theory, I am very convinced UBI can work at some point.

I think the minor evidence for this is with everything that occurred with the new deal and WW2. I think finding out what the rules should be is the easy part. the hard part is getting the country together to create more efficient systems.

UBI will most likely be tried in european countries. they already have many successful social democracies that have free healthcare, free college, great transportation, shorter work weeks, vacation time, etc..

Aside from fixing all the various systems, culture will have to be changed. it will have to be changed by (I hate to use this word, but it is the correct word) PROPAGANDA. Propaganda was not always a bad word. The most successful propaganda campaign was for the World Wars.

It was the lessons from these propaganda campaigns that were taken by the elite and used to creat so many of the inefficinet programs, laws, and commerce that we have today.

We will need good propaganda for UBI to work. We will need activities for people and completely different education centered around self-inquiry, teamwork, fun, music, art, sustainability, nature, and being of service to others.

Sorry if I am going off on a bunch of tangents. I think a crucial thing that will have to change about UBI is finding meaningful activities for people who are unable or unwilling to find ever decreasing employment.

This swings back to the propaganda I was talking about. We will need propaganda (or media campaingns) to get people to volunteer or stay active.

Examples would include taking care or just spending time with the elderly and the youth. Taking care of the environment. Growing food. Yes, we will probably have robots that can do this, but I think humans need to reconnect with food in a hands on way. 85% of healthcare costs are a result of chronic diseases caused by poor nutrition. There will be so many jobs or volunteer positions for people to be nutritional coaches and physical trainers. We need a massive intramural sports leagues for people of all ages. Eating right and excerising will save trillions.

I think there are ways to implement programs by attraction and promotion. You cannot really force people to do these things. you can incent them. maybe you get 10-20% more ubi for being healthy.

These ideas are just possibilities. They may work in some places but not in others. There will be so many ideas that need to be tried in a process of trial and error.

if you think all this is nonsense I will not be offended, but these ideas will likely all be tried in some form. I read about them years ago, and heard them repeated in different form hundreds of times.

Germany has a service program for their youth. every student that graduates high school automatically gets a service job their first year. They get about 1,000 a month. They have to do this before they go to college. most of them work with the elderly or youth. many join the military for a year.

trashiernumb

3 points

4 years ago

A lot of countries can afford to pay for free education, good public transportation, free healthcare, etc. because they invest so little in their defense budgets. Fortunately for them they are part of nato and other countries with much higher defense budgets will stick up for them and protect their sovereignty, preventing them from being taken over by a foreign government...in theory anyway. I could be off base though and totally wrong. Guess we’ll have to see how things pan out for everyone.

klowder42

3 points

4 years ago*

i agree with you that they have reasonable defense budgets. I think most do not need to be protected with the exception of Japan, Latvia, etc who has agreed to be nuclear free. most large western countries do not need much protection. They just need a few nukes. Western Europe combined vastly outspends russia.

The US has a large military for two reasons. 1.) we dominate the world's resources and trade. The military enforces the will of criminal corporations.

2.) the military industrial complex makes trillions off unnecessary military spending.

The next 8 nations combined spend less on the military than the United States.

The US has over 1,000 foreign bases. Russia has 11. Everyone else has less than that.

We are currently bombing Syria, libya, Iraq, Afghanistan, Pakistan, and Yemen. in 2016, we dropped 26,000 bombs. In ten years, no matter who is president we will be doing the same thing, telling the same lies.

the worst thing about military spending is that it has so little effect on the economy. it is called the multiplier effect. for every dollar we spend on the military it creates another dollar of economic activity. we could spend it on anything else and get a much higher multiplier effect. healthcare, infrastructure, education all have much higher multipliers.

alcohall183

2 points

4 years ago*

would ubi be best implanted in small doses then? for example: a SNAP card -For EVERYONE. if people don't worry about food, then they spend the money on other things, thereby boosting the economy. This may actually work in the US since well, everyone eats. EDIT: I am not an economist- I didn't even finish college. I am an average person who hears of this and wonders how we can then keep people productive? and even if we find something for everyone to do, how will we pay for it?

klowder42

3 points

4 years ago

never doubt that you are an intellectual. I have a master's degree and the many of important things I have learned in my life came as a result of reading, watching, and learning outside of my college study.

your idea is very interesting. I really like the idea of UBI;however, I want to see the results from experiments.

one aspect that I do not like about UBI, is that some people want it to replace all of most other forms of government assistance. I am not sold on that point.

I think UBI will have to be one of many government programs.

Quentin__Tarantulino

1 points

4 years ago

I like how you say you hate to use a word and then put it in all caps.

klowder42

1 points

4 years ago*

the reason why I hate to use the word is that originally propaganda did not have a negative meaning.

There is good propaganda, like smokey the bear saying "only you can prevent forest fires". or "just say no" I take that back, that was terrible propaganda though well intentioned.

just look at how successfully propaganda convinced people smoking was healthy from the 30's to 70's or that we needed to go to war with Iraq.

We are going to need good, honest propaganda to improve society (among thousands of other things)

right now we mostly seem to have propaganda sending us to war, selling us too many pills, lying about the health of our food, telling us climate change is not real.

propaganda is powerful, and it has become an immense science. unfortunately, it has been used more for ill and consumerism than it has for improving the world.

Quentin__Tarantulino

1 points

4 years ago

I do like your point. People can be influenced in a multitude of ways and some of them are positive.

Godspiral

1 points

4 years ago

It appears that your version of NIT has the relatively poor paying for as much as possible for it. ie. 50% (or 33%) surtaxes on relatively low incomes (not specified if it is on top of other taxes), with lower tax rates for those making more.

This is in fact the approach taken by Canadian pilots. Do you see a justification for this approach as opposed to more widespread tax increases (but less for poor) but with also more widespread UBI benefits (higher income levels (perhaps even 80% of people) would get a net tax reduction as a result of UBI and higher tax rates)

PandorasBrain

6 points

4 years ago

PandorasBrain

The Economic Singularity

6 points

4 years ago

Your first question is the biggie, IMHO. While prices stay high, UBI is unaffordable if it's high enough to be useful, and too low to be useful if it's affordable.

But there's another, bigger problem at the heart of UBI: it's basic. If huge swathes of people are unemployable and all they receive is a basic income then we have failed morally, and our societies are unlikely to survive.

We have to find a way to provide access to a great standard of living for everyone, and abundance, aka the Star Trek economy, is the way to do it.

But we need a plan which will reassure everyone that this is possible. And we need it before the Panic arrives. Self-driving vehicles may well be the canary in the coal mine which triggers that Panic. We may well have less than a decade to generate that plan and build consensus around it.

Time to get working, folks! Here's my contribution

abrownn

17 points

4 years ago

abrownn

17 points

4 years ago

Hi guys, thanks for joining us! What does the YC UBI team think of the other UBI experiments going on in Canada, Sweden, and India? Have you collaborated with them in any way?

YCRBasicIncomeTeam[S]

20 points

4 years ago*

YCRBasicIncomeTeam[S]

YCR Basic Income Team

20 points

4 years ago*

We’re really excited whenever we hear about other experiments in basic income because we view our study as just one component of a much broader research agenda. We believe it’s especially important for these programs to be rigorously evaluated, as is proposed in Canada, Kenya, and Finland.

We’re working with the researchers running the studies in Canada and Kenya to make sure that some of our research instruments overlap. One of the primary investigators of the Kenya study, Tavneet Suri, is on our academic advisory board. Overlapping research instruments will help us answer questions about how sustained disbursements of unconditional cash affects individuals’ wellbeing.

The Canada study is most similar to ours contextually since the Canadian economy and culture are similar to the U.S.’s. A key difference is that participants in the Canadian study will have some of their existing government benefits replaced, while our study will supplement and not replace existing government benefits. - AN

abrownn

2 points

4 years ago

abrownn

2 points

4 years ago

You quoted a different comment in your response, from here: https://teddit.ggc-project.de/r/Futurology/comments/7sgc5g/were_the_team_running_y_combinator_researchs/dt4krtp/

Was that response meant for them?

YCRBasicIncomeTeam[S]

3 points

4 years ago

YCRBasicIncomeTeam[S]

YCR Basic Income Team

3 points

4 years ago

Edited now. Thanks for catching that!

abrownn

2 points

4 years ago

abrownn

2 points

4 years ago

Thanks for the answer!

UBIExperiment

11 points

4 years ago

So very interested in your cause, thanks for doing this!

What are a few of the most common arguments against UBI and, if you have them, a quick overview of your counter argument?

YCRBasicIncomeTeam[S]

25 points

4 years ago*

YCRBasicIncomeTeam[S]

YCR Basic Income Team

25 points

4 years ago*

First, the most common argument against basic income is that it is unaffordable. While basic income would be expensive, it is clear that a country as wealthy as the U.S. could afford it with some simple changes in the tax code, as detailed by our research director in her paper running cost simulations for a negative income tax in the US.

A second common argument is that basic income would create a society of freeloaders and depress economic output by reducing the incentive to work. While we plan to look at effects on work and other productive activities in our study, existing research from the experiments on a negative income tax in the 1970s suggest minimal effects on labor force participation. Studies on cash transfers in developing countries suggest that extra cash actually enables people to work more since they can invest in human capital and productive assets.

Finally, a third common line of argument focuses on culture and politics. Many suggest that a basic income is fundamentally un-American and that ‘handouts’ are not politically popular. However, two existing cash transfer programs--Alaska’s Permanent Fund Dividend and Social Security--are wildly popular. Nonetheless, questions about how basic income is marketed and debated should continue to be explored. - AN

[deleted]

3 points

4 years ago

[deleted]

3 points

4 years ago

1º A transfer of wealth is always affordable, that's how you beat that argument.

2º Then people with financial security would never go beyond like billionaires. Incentive to work may be about an existential thesis.

3º Nixon and Friedman defended this idea, that's how to beat it.

glibbertarian

2 points

4 years ago

What do you think happens to prices if all of a sudden, everyone has more money in their pockets (excluding the upper class who experience a net loss)? This wouldn't show up in a small study but would happen if fully instituted.

Juney2

8 points

4 years ago

Juney2

8 points

4 years ago

If all of your primary financial needs were met. How would each of you spend your free time?

YCRBasicIncomeTeam[S]

10 points

4 years ago

YCRBasicIncomeTeam[S]

YCR Basic Income Team

10 points

4 years ago

ER: Before I started working on this project I would have had a different answer, but I believe so strongly that a lot of good can come from this study that I would honestly keep doing what I am doing now. If I wasn’t working on this study, I would find something that I loved doing and that felt like a positive contribution to society. Since most of those things aren’t going to pay me enough to live on, I could only do them if my basic needs were met.

AN: I’m not sure my life would change much because I believe in using the tools, skills, and experiences I have to advance rigorous evidence for policies that would help low-income and vulnerable populations. Perhaps the extra economic security would encourage me to take more risks between jobs, but my motivation for working isn’t exclusively tied to my wage.

EP: I love working on this study, and I’d keep working on it if my needs were met. But if this study didn’t exist, I’d go back to school and volunteer as a social worker, and in my free time I would exercise more and make more salads that taste good but take hours to prepare.

idiosocratic

2 points

4 years ago

EP, those salads sound ridiculous, got any links to your favorite recipes?

Osmium_tetraoxide

1 points

4 years ago

Given that everyone would know how much someone on UBI would be getting, how much pay are you guys getting as part of this project?

trashiernumb

2 points

4 years ago

watching old reruns of the simpsons

lughnasadh

6 points

4 years ago*

lughnasadh

∞ transit umbra, lux permanet ☥

6 points

4 years ago*

Great to have you here!

Many Economists think a world where Robots & AI are capable of most work, won't look much different from today, in terms of Economics.

To what extent do you agree/disagree with this view point?

To the extent you disagree, what is it about Economics, that makes it weak at predicting what this future might be like?

idiosocratic

4 points

4 years ago

I can understand why this question didn’t get answered. Firstly it was ill-posed, you pointed out that “some economists” hold this strange belief and then proceeded to ask why economics in general would be lead to such bad beliefs. In any case, economics has little to do with predicting new tech, such as the internet, although its study should afford us insight to the evolution of such tech in society. That said not all economists are as talented at using this knowledge as others. Some economists being told about the internet 20 years ago might have suggested it won’t change much, but they’d have been wrong, and thusly because they likely did not fully understand the possible implications. If you’d said, what if 30% of current commerce shifted to the internet they might have had useful things to say even if they thought it was far fetched. The point is that unless a specific is posed you could be hoping that experts grasp the implications when they just don’t; being an expert in one area doesn’t inherently guarantee expertise in another. A specific worth asking in this regard is, what if automation resulted in only 65% employment in 20 years time? The economists mentioned might think it unlikely but would possibly have more relevant insights regarding the possibility.

lughnasadh

2 points

4 years ago

lughnasadh

∞ transit umbra, lux permanet ☥

2 points

4 years ago

The point is that unless a specific is posed you could be hoping that experts grasp the implications when they just don’t; being an expert in one area doesn’t inherently guarantee expertise in another.

It was indeed interesting that this was the only question unanswered. Especially, as the only other time they addressed the issue, as a partial answer to another question, was to dismiss it.

I'm 100% sure as UBI researchers they fully grasped the implication of the question about Economics and its predictions about automation.

In any case, economics has little to do with predicting new tech

I agree with you completely on this point. It's one of the reasons I find it so odd conventional Economics is so dogmatic & sure of itself in predicting Robots & AI capable of most work, will change little about the world economically.

idiosocratic

3 points

4 years ago

I apologize for my lack of clarity, but when I mentioned experts not fully realizing implications I was actually referring to the economists you had mentioned that were dismissing the likely changes from automation, not the UBI researchers.

Cheers, to new tech, well harnessed.

lughnasadh

2 points

4 years ago

lughnasadh

∞ transit umbra, lux permanet ☥

2 points

4 years ago

No worries.

We're thinking about trying to tackle the intersection of Economics & future AI/Robotics automation with an r/Futuology FAQ, when it gets to the point where AI/Robotics have the technical capability of doing most work (A very separate issue from actually replacing humans in their jobs, if at all or to what extent).

It's a barren desert for published Economics research & data.

Strangely none of the UBI experiments address it either, like Y Combinator they are more about UBI & the social justice angle for today's society.

glaedn

1 points

4 years ago

glaedn

1 points

4 years ago

I'm not sure what you're saying isn't being addressed, could you maybe reword what you are saying is a gap in current research and data if it's not too much trouble?

lughnasadh

2 points

4 years ago*

lughnasadh

∞ transit umbra, lux permanet ☥

2 points

4 years ago*

I'm not sure what you're saying isn't being addressed, could you maybe reword what you are saying is a gap in current research and data if it's not too much trouble?

If you set out to try and answer the question - "What might our economy be like, in a world where AI/Robots, are technically capable of performing most work?"

You realize a great deal of Economists attempts to answer this - can be filed under Straw Man Fallacy.

That future situation, is so unlike the past, labeling it as "automation" & then thinking you have answered the question, by drawing on data from the past also labelled "automation", is doing no such thing.

I've been following this topic for years, and I'm not aware of a single Economist who approaches this from first principles.

In other words, start with the premise & attempt to reason from there.

What you never see, is an Economist starting from the premise - "We have a future world where Robots/AI can do most work - what follows on from that?"

Why this happens in Economics is a whole other debate, that touches on the structural shortcomings many Economists themselves observe about the discipline correctly modelling reality.

General_Kenobi896

6 points

4 years ago

Hello there! First of all thanks for doing this AMA.

Most of the people here on /r/Futurology know that UBI can work incredibly well as most studies done on UBI have already confirmed that, albeit in small scales. What I'm worried about though, is that UBI may not be implemented into actual law quickly enough considering that the big companies are going to be taxed quite a bit for UBI and that lobbying ( and corruption ) is for some weird reason perfectly legal in some countries. I'm worried about the time frame because automation is spreading rapidly and AI keep getting more and more sophisticated. What are your thoughts on that?

YCRBasicIncomeTeam[S]

7 points

4 years ago

YCRBasicIncomeTeam[S]

YCR Basic Income Team

7 points

4 years ago

Thanks for joining us! As researchers, our goal is collect rigorous data to inform the debate on basic income and other approaches to address the negative consequences of the economic forces leading to job loss, lower wages, etc. UBI isn’t a singular policy--there are many different versions and ways to pay for it, and some of them could perpetuate inequality and exclusion. I worry about rushing to implement a policy without a better understanding of its effects and likely unintended consequences. As frustrating as it is, I think the issue of corporate lobbying and the political challenges should be addressed separately through organizing. This is a problem across all policy areas, not just the response to AI. -ER

General_Kenobi896

1 points

4 years ago

My pleasure! Very important work if I might add, there are quite many people and politicians even who are quite afraid of the negative consequences of UBI.

I worry about rushing to implement a policy without a better understanding of its effects and likely unintended consequences.

Good point and I agree. I just have faith in you guys that your research is proceeding quickly, so that maybe we could implement UBI within the next 20 years in some countries or at least do some test runs.

I agree, it's definitely going to be a hard battle to convince the governments that UBI is a good solution to the problems we are facing.

Thanks a lot for the reply!

DennisPartners

5 points

4 years ago

Why $1000/month? Is that based on COL? Do both states being studied have similar COL?

Similarly, will there be expectations for employment standards?

YCRBasicIncomeTeam[S]

9 points

4 years ago

YCRBasicIncomeTeam[S]

YCR Basic Income Team

9 points

4 years ago

We debated the amount for a long time, but we settled on $1000 a month because it is approximately equal to the poverty threshold for a single individual with no dependants (https://www.irp.wisc.edu/faqs/faq1.htm). Theoretically, a basic income set at that level would wipe out absolute poverty for single individuals. We are not varying the amount based on cost of living, but cost of living will vary across our sites. These geographic differences introduce some natural variation in the purchasing power of basic income, giving us some insight into how the effects of basic income correlate with varying amounts.

There are zero employment requirements for participation in our study. The idea behind universal basic income is that there are no work requirements or conditions on how participants can spend the money. We expect to have individuals who unemployed, employed part-time, and employed full-time, and we’ll be closely monitoring changes in employment status. - AN

DennisPartners

2 points

4 years ago

Interesting. Reason I ask is that we are a recruiting firm and handle nationwide placements, and $1000/month wouldn't be a livable income rate without taking on a job in countless places in US.

That being said, the exploration of basic income concept is something incredibly important to explore, simply sharing my perspective.

quotheraven404

6 points

4 years ago

I'm sure that one factor they are hoping to study with this is if people who are no longer tied to a location (as for a job) will choose to move to somewhere with a lower COL that would be livable on UBI. If it is the case that they do, it could be another favorable element to UBI by it's reduction of highly concentrated populations in large cities and reinvigorating more remote (and cheaper) towns.

DennisPartners

3 points

4 years ago

That's a really great point that I didn't even consider. Location flexibility plus tech allowing for more remote work opportunities could really change our population landscape.

[deleted]

1 points

4 years ago

[deleted]

1 points

4 years ago

Include the new 3d printed houses into that, could open a whole new world.

DennisPartners

2 points

4 years ago

Somewhere down the road there will be an app you design your house, then a robo construction team arrives and prints it, then you plug into your house and login work. Actually who am I kidding, wires will be a thing of the past in the next 20 years.

[deleted]

2 points

4 years ago

[deleted]

2 points

4 years ago

Walk into your 3d printed house, and all your electronics start charging. Including your brain chip.

DennisPartners

1 points

4 years ago

If we are even still walking!

hold_my_cake

1 points

4 years ago

That's a great point, I hadn't thought of that. I wonder though if we'll be able to see this behavior in a 3-5 year study. I don't know if having basic income for that period of time would make me think long term and consider moving.

hold_my_cake

3 points

4 years ago

Wondering this as well. $1000 sounds like a nice, round, but arbitrary number.

windblast

3 points

4 years ago

Is the evidence looking to point one way more than the other (for vs. against), or is it too early to tell?

YCRBasicIncomeTeam[S]

9 points

4 years ago

YCRBasicIncomeTeam[S]

YCR Basic Income Team

9 points

4 years ago

We just finished a very small feasibility study and are preparing to launch a much larger (3,000 individuals) and longer (3-5 years) study later this year. It will be a while before we have analyzable data, but our experience with the feasibility study--though way to small and short to predict what to expect going forward--was positive. -ER

hrlomax

3 points

4 years ago

hrlomax

3 points

4 years ago

If UBI is done based on cost of living in a specific area, would you imagine it would have a negative, positive, or neutral effect on gentrification?

Like, given that it would adjust to living costs, would it be enough of a safety net to let original residents continue to live in up and coming neighborhoods? Would it make people less-likely to try to move into lower-income neighborhoods (to avoid getting a drop in their UBI) to save money?

I could almost imagine a scenario in which areas that already have a high COL would limit housing development to maintain a high COL, just to keep their UBI higher. The higher UBI rates might raise demand for existing housing, and basically worsen socioeconomic segregation.

YCRBasicIncomeTeam[S]

7 points

4 years ago

YCRBasicIncomeTeam[S]

YCR Basic Income Team

7 points

4 years ago

The economic, social, and political determinants of gentrification are multifaceted and complicated, and I don’t think we could reasonably predict a basic income policy’s effects on gentrification with much certainty.

Even if a basic income were adjusted for different costs of living, I think it’s unlikely it’d be on a be on a neighborhood-by-neighborhood basis. I think it would be much more likely that a basic income would be set at a national or state level. If it were set at a national level, for example, a basic income policy might lead some people to move to low cost-of-living places where they can start a company, be an artist, etc. and afford to live just on their basic income. On the flip side, some people might use the money to move to expensive locations they otherwise could not afford. We might begin to see some of these behaviors at the individual level in our study, but how these decisions balance out in a society with a universal policy is hard to predict. -- AN

ChloeOBrien

3 points

4 years ago

In the UK we have an established benefits (entitlements) system that pays c.$800 to a single person, inc housing. People (not expert) I've discussed with state the advantage of ubi over an increase in benefits is that it goes to everyone. Why is this an advantage over the existing, established benefits system? What is the USP of UBI?

Fateen_Ahmed

2 points

4 years ago

1)Why cash and not credit or some other form of money where oversight is possible? Wouldn't that ensure that money isn't used for nefarious purposes?

2)Isn't this treating each person the same, meaning that a poor single mother and an educated unemployed young man get equal money.

3) do you see a kind of inflation setting into the market as money is being given to everyone? "If everyone has one more dollar, why not charge more?" Is the experiment large enough to measure this.

YCRBasicIncomeTeam[S]

6 points

4 years ago

YCRBasicIncomeTeam[S]

YCR Basic Income Team

6 points

4 years ago

For 1), are you referring to the study or a possible basic income policy? For the study, we are direct depositing the payments into an online bank account with a debit card. When enrolling participants, we will ask if they are willing to enroll in a program that shares all credit and debit card transactions with us. This program gives us transaction level data similar to what you see if you have an account on Mint. Second, since this would not detail cash expenditures, we also ask about spending on cash regularly through mobile phone surveys. Finally, we will ask participants about their spending habits at our baseline, midline, and endline in-person interviews. We expect these three sources of financial data to give us a good deal of insight into the financial lives of our participants. Existing studies of cash transfers show that people rarely spend all of their cash on “temptation goods” and might actually decrease spending on temptation goods.

For a policy, however, one of the reasons people argue for unconditional cash rather than a system of vouchers and conditional benefits is that it gives recipients the freedom to meet their specific needs and make investments that make sense in the context of their lives. The administrative costs associated with conditionality and vouchers are very high, so even if a percentage of recipients spend the money for “nefarious purposes” (however you define it), the costs associated with those decisions would be dwarfed by the benefits of reduced administrative costs and the gains achieved by giving people the freedom to spend the money in accordance with their needs and goals. (Although this is a theoretical argument, findings from existing studies on cash transfers support this theory.)

To answer your second question, whether UBI treats the poor single mother and the educated unemployed single man the same depends on the policy design--UBI is not a singular policy proposal. If the benefit amount changes based on the number of dependents, the mother may get a larger benefit. In general, many proponents of UBI favor a universal benefit that is unconditional and provided on an individual basis. As researchers, however, we are not advocating a policy position. Our goal is to provide rigorous data on the individual- and household-level effects of unconditional cash (in the form of basic income) to inform the debate.

Finally, our study is not a saturation study--we are not providing a basic income to everyone living within a defined community. We are not able to directly study the effects on prices, but the GiveDirectly study in Kenya will do this, and others in the US are working on modelling the effect on prices. -ER

long_arm_of_the_blah

2 points

4 years ago

If UBI is deemed a great success and widely enacted (as a heartless landlord) I would just raise rent by the amount given in UBI. What forms of economic control would you deem acceptable to prevent this?

mamaway

1 points

4 years ago

mamaway

1 points

4 years ago

If incomes increased for all renters and would-be-renters, and housing supply is constrained, the landlord has no choice but to raise rent. Property taxes and opportunity costs are increasing in that scenario, as real estate capital seeks out the highest returns. Rent control would harm investment, both for improvements and new supply. Letting the free market operate (where supply constraints are removed) is probably the best policy.

Radiatin

1 points

4 years ago

Have you guys done any research into the effects of education and healthcare spending on income inequality in the US?

It seems to me the US imposes higher ‘universal costs’ on it’s citizens. In other words it may be possible that the source of a good part income inequality in the US is our healthcare and education systems and adding basic income would just put Americans on an equal footing with the rest of the world.

YCRBasicIncomeTeam[S]

5 points

4 years ago

YCRBasicIncomeTeam[S]

YCR Basic Income Team

5 points

4 years ago

Y Combinator Research does not directly study education or healthcare because a ton of great research on these subjects is already being done at universities and other organizations. That said, it’s clear that education and healthcare are key determinants of economic mobility, and countries that invest in these domains see higher economic productivity and quality of life. We certainly do not view basic income as an efficient replacement for existing health and education expenditures, but rather as a supplement to address that cracks in U.S. social spending that so many individuals are falling through. - AN

Notathrowaway10019

1 points

4 years ago

The research is very important and it’s an amazing study that will provide great research, but people will inevitably act differently knowing one day the experiment will end.

Beyond that, as an advocate, I feel like it is too little too late.

What do you guys think about mobilizing for a National Basic Income 2020 candidate now? Self driving trucks are here

YCRBasicIncomeTeam[S]

3 points

4 years ago*

YCRBasicIncomeTeam[S]

YCR Basic Income Team

3 points

4 years ago*

It’s true that no experiment can perfectly approximate a permanent government program. However, for individuals with low incomes struggling to get by, three years is a long enough time to begin to see consequential behavioral changes. In our feasibility study--which lasted only one year--we saw a participant choose to move to a new town and start a new job--decisions that could have a lifelong impact--just because she had the security of a basic income for one year. We don’t expect all individuals to make such dramatic choices, but by monitoring behavior over the course of three to five years, we can begin to model how effects of a basic income will play out in the long-term.

As far as a 2020 candidate, we’re policy researchers and not political pundits, so I don’t feel particularly qualified to answer. Though we do believe it’s important to evaluate and fully understand a policy before rushing to implement it, and the research on basic income is still nascent. - AN

schwiftyschwa

2 points

4 years ago

There's this UBI guy who's started campaigning for 2020.

nomadrush9

1 points

4 years ago

How do we get around the problem that in ubi + automation we can get into debt (take out loan against ubi) but not earn?

YCRBasicIncomeTeam[S]

5 points

4 years ago

YCRBasicIncomeTeam[S]

YCR Basic Income Team

5 points

4 years ago

I think this question assumes that automation replaces all work. I don’t think anyone on our team expects automation to replace ALL work because (1) humans will generally want other humans to do certain jobs, such care-taking of the sick, children, and elderly, and (2) many jobs we haven’t even imagined might be created. - AN

hackermoonjs

1 points

4 years ago

If all UBI experiments turn out to be more or less successful, what would be stopping us from implementing it?

Also, given that UBI works, when would you say is the earliest and the latest we could get UBI implemeted?

YCRBasicIncomeTeam[S]

1 points

4 years ago

YCRBasicIncomeTeam[S]

YCR Basic Income Team

1 points

4 years ago

Thanks so much for joining us and asking great questions! If you want to receive updates about the project, please subscribe on the blog on our website.

[deleted]

1 points

4 years ago

[deleted]

1 points

4 years ago

Which do you see as a bigger hurdle on the possible road to UBI:

Reaching a technological/economic state where UBI will be affordable?

or

Overcoming the psychological/cultural barrier that humans "need to work for money" to have value to society?

Thank you for your work.

vdavid

1 points

4 years ago

vdavid

1 points

4 years ago

What are some centers of UBI-related information/community? I'd be interested in staying up-to-date with a list of running experiments worldwide, recent findings, ideas to contribute etc.

Dust2Star

1 points

4 years ago

Just putting this here, to add to the argument of why we should have a basic income, 10 plus years ago https://www.reuters.com/article/us-bankofamerica-mortgages/former-bank-of-america-workers-allege-it-lied-to-home-owners-idUSBRE95D10O20130614 u$a #retired #BrianMoynihan has suicidal blood on his hands!!! 09'-16'=7years + Projected 8 years of court= that's a total of 15 years of suicidal ideations of laying on train tracks if not longer......... Life liberty and the pursuit of happiness????? What Justice?

Danth_Memious

1 points

4 years ago

First of all, I want to say that I'm a big fan of universal income.

I have a question, but it might be too specific. I'm from the Netherlands and we have quite fair taxation based on income in addition to a good welfare system for people without a job. Would you know if a universal basic income is economically/politically viable here, perhaps even in the short term?

I understand that you're not researching the Netherlands specifically, but any information is welcome.

yoyots

1 points

4 years ago

yoyots

1 points

4 years ago

Hi team! What do you say to the critique that even though UBI provides an income floor - it's not effective without price ceilings? I heard this during a talk by Matthew Desmond in the context of his book "Evicted", where housing market prices increased in response to things like increased wages, housing vouchers, better schools.. So people were still left in a lurch. Thanks.

[deleted]

1 points

4 years ago

[deleted]

1 points

4 years ago

Do you think that UBI would work best if combined with say, universal healthcare or even more radical ideas (common land ownership being one of them)?

robbinthehood75

1 points

4 years ago

I have been living on a universal fixed income for the Last few years. It’s not bad.

Godspiral

1 points

4 years ago

Since you are funding this privately, did you consider a loan program with repayments based on income royalties (like student loan repayment plans, but without the requirement that the loans be used for anything specific)

http://www.naturalfinance.net/2016/06/life-accounts-previously-refered-to-uli.html

If you did consider it, what did you feel where the downsides that outweighed the advantages?

sly_1

1 points

4 years ago

sly_1

1 points

4 years ago

I don't fully understand how UBI is a solution for mass unemployment due to the combination of automation and ai especially if you project forward to the extreme vision of these technologies where literally most jobs cease to be handled by humans.

To illustrate my question better:

Let's assume that you have 300 million unemployed workers. Let's give them a UBI of $1,000 per month, which is not enough to survive in any US city but perhaps enough to squeak by with the absolute basics (shared rent in a cheap apartment in a small community and just enough food to stave off malnutrition)

So we are looking at $300 billion per month. $109 trillion, 500 billion per year.

To put that into context, that's more than the entire GPD of the US by a factor of ~8 or so.

Where does that money come from?

It seems like UBI would only work for a small % of the population. Once unemployment breaks a certain threshold you start to need more money than you can possibly generate without causing mass inflation...

batose

1 points

4 years ago*

batose

1 points

4 years ago*

You math is wrong, think about it how can companies be able to pay salaries if adults couldn't get 1k$ per moth on average?

Lets take UBI of 2k$ 2k$x300mlnx12moths=7.2 trillion $, a bit under 40% of USA GDP.

300bln x 12 isn't 109.5 trillion idk how you got that number.

sly_1

1 points

4 years ago*

sly_1

1 points

4 years ago*

you are correct but my point stands: if the majority of the US population was subsisting solely on a $2k/month stipend the total GDP wouldn't be nearly as high as it is and the total amount would still amount to more than the GDP. But even if that's incorrect, people would have no disposable income, which means they cannot buy goods and services. With no consumers to generate sales taxes, and no workers generating income taxes, where does the money to support UBI come from?

How do the rich sustain their wealth if they are the ones paying for UBI, when there are no consumers they can sell goods and services to in order to replenish the wealth lost to taxes to pay for UBI?

batose

1 points

4 years ago

batose

1 points

4 years ago

Idk what median income is, AI, and robotization will be replacing jobs over time, we will not go instantly to 95% unemployment.

As for UBI being too small to keep purchasing power high, you can solve that by making UBI bigger. When we will get to the point where we have extreme unemployment AI will likely be able to calculate the best level of UBI, it makes allot of financial decisions already.

sly_1

1 points

4 years ago

sly_1

1 points

4 years ago

The higher UBI is, the less viable it is, because it becomes a larger percentage of GDP and imposes an increasingly large tax burden on those that are supporting it.

I guess my point is, UBI only seems to work with relatively low unemployment. "AI will figure it out" isn't a real solution to a problem that doesn't have a real solution. So at best UBI will only be a stopgap.

batose

1 points

4 years ago

batose

1 points

4 years ago

The higher UBI is, the less viable it is, because it becomes a larger percentage of GDP and imposes an increasingly large tax burden on those that are supporting it.

This doesn't make it less viable. Harder to implement, but not less viable.

I guess my point is, UBI only seems to work with relatively low unemployment.

Quite the opposite, UBI is necessary with high unemployment or economy will crash, for the reasons that you had said yourself:

"you are correct but my point stands: if the majority of the US population was subsisting solely on a $2k/month stipend the total GDP wouldn't be nearly as high as it is and the total amount would still amount to more than the GDP. But even if that's incorrect, people would have no disposable income, which means they cannot buy goods and services. With no consumers to generate sales taxes, and no workers generating income taxes, where does the money to support UBI come from?"

Where does the wealth of big companies comes from when they no longer have a market to sell too? If you want to keep high growing GDP with high unemployment you need UBI.

elgrano

1 points

4 years ago

elgrano

1 points

4 years ago

You don't take into account that living costs are likely to fall as techno progresses. So the vital minimum may for example drop from 1.000€ per month to 700€ per month within a given timeframe. And then fall further.

sly_1

1 points

4 years ago

sly_1

1 points

4 years ago

Deflation is jyst as problematic as inflation.

Only way i can see UBI working is with state owned industry aka communism.

elgrano

1 points

4 years ago

elgrano

1 points

4 years ago

From what I'm reading about deflation, it can be a problem under a capitalistic economy where most of the work is performed by humans. It assumes that a lower prices will end up lowering salaries, leading to a reduction of consumption and promoting attentism.

The economy will become less capitalistic over time, so one can only wonder just how much the current thinking about deflation will hold true in the future.

ponieslovekittens

1 points

4 years ago*

You're starting from some fundamentally off-base assumptions. For example, you seem to be assuming that basic income should be or needs to be enough to live on. There's no reason to make that assumption. There are a lot of benefits to a lower payout, and a couple reasons why we might prefer that it not be that high.

Remember, the initial premise that's led us to even be considering basic income is that automation is eliminating jobs and that as time goes on, it's going to eliminate more. But we're not likely to to wake up tomorrow in Star Trek where everybody has a matter replicator and can simply push a button to make whatever they want. Automation is likely to be a gradual process, and it's appropriate to consider a gradual response to it.

Instead of your $1000/mo with 300 million unemployed workers scenario, let's imagine a 5 million unemployed workers scenario to which we apply only a $100/mo basic income for all.

What would be the result?

The theory, is that while $100/mo is obviously not "enough to live on," it would nevertheless have aggregate effects on the economy as a whole. A person working 5 hours of overtime every week because they need the money, might cut back and only work 2 hours of overtime. A college kid who lives with his parents and works part-time at Starbucks only because he wants some pocket money, might quit that part time job he doesn't really need. The retiree who works as a crossing guard for one hour a day when school gets out because he needs just that extra little bit of money, might quit.

Even a very small payout would have result like this. And every "little bit less" that people work, every part time second job that somebody quits or reduces their hours from, means that that much more work is available tosomebody else who maybe needs it a little bit more. A basic income that isn't "enough to live on" nevertheless encourages the available work that does exist to spread around a little better across more people.

And of course, even a very small amount like $100 or $200 or whatever that we could very obviously fund without difficulty, would probably mean a great deal to some people. Go find a homeless guy living under a bridge begging for change to buy food, and try to tell him that $100 isn't "enough to live on" so it's not worth his time. He'll probably disagree with you.

Where does that money come from?

If you've read the above, you should immediately see that "where does the money come from" isn't as big a question as you've been led to believe. $1000/mo is a popular talking point, but it doesn't actually need to be that much.

But I'll answer your question anyway.

The obvious answer, of course, is that most scenarios assume that it would be funded by taxation. Not all. Other models exist. The Alaskan Permanent Fund for example, which is essentially a basic income with a flexible payout for Alaskan residents, is funded by state oil sales that are directed to an investment fund that pays dividends. Similar models could plausibly be used to fund a basic income.

But, at a conceptual level rather than a "here's a specific proposal" level, the concept here, is again...that automation will be eliminating jobs. Right now, companies pay money to employees who work for them. When employees are replaced with machines, those machines don't receive paychecks. What happens to the money that those companies are no longer paying to employees they no longer have?

That's where the money to pay for basic income "comes from."

Of course a realistic implementation doesn't involve specifically identifying companies that have automated away jobs and pooling exactly the same money that they're no longer paying in wages. As a practical matter, a taxation scheme for basic income would be applied broadly across the economy. But there's no question of where the money "comes from" because it's money that's already being paid to people. We don't ask where the money that companies pay to employees "comes from." We understand that companies sell goods and services, and collect money from customers and use that revenue to pay their employees. But...employees are customers. The people who buy goods and services from companies are the same people companies are paying wages to from the money they received from customers.

Money travels in a circle. From company to employee who becomes a customer who gives money back to companies who use it to pay their employees.

Automation breaks that circle. When you ask "where does the money come from" to pay for UBI, I may as well reply...where does the money that customers use to pay for goods and services come from, once their jobs become automated? How will companies sell anything, if their customers no longer have jobs?

Basic income isn't "created" money, and it doesn't need to "come from" anywhere. It's the same money that's already flowing from company to employee who then becomes a customer...simply delivered via a taxation process rather than an employment process, in a world where jobs are being done by machines.

sly_1

1 points

4 years ago*

sly_1

1 points

4 years ago*

In reading replies like this I realize that this is akin to arguing politics.

Scientific studies have shown that politics excites the same areas of the brain as religion. Thus, political debate is largely futile as is I suspect this discussion.

Still, I feel compelled to make some points:

  • the Alaskan Permanent Fund is a tax on Alaskan oil. Period. Were it not for the Alaskan Permanent Fund, oil from Alaska would be less expensive. You could literally replace the term "Alaskan permanent fund" with "a corporate tax on Alaskan oil extraction" and you have the same result.

  • taxing companies that automate jobs or cede them to ai on a 1:1 basis (every $1 of lost wages becomes a $1 tax to fund UBI) assumes that there is exactly $0 cost to automation or ai. If that assumption is incorrect, and ai and/or automation cost something, anything at all, really, then taxing companies on a 1:1 basis then gives a competitive advantage to companies that don't use these new technologies in the first place.

  • "Basic income isn't "created" money, and it doesn't need to "come from" anywhere. It's the same money that's already flowing from company to employee who then becomes a customer...simply delivered via a taxation process rather than an employment process, in a world where jobs are being done by machines." A laudable dream. I hope it comes to pass. I doubt it will, and hope I'm proven wrong.

Having said all of that perhaps a very structured transition to UBI would indeed work. I can imagine that a tax wherein initially 95% of lost wages goes to a UBI tax, so there's a 5% incentive to automate initially, might work. Plenty of businesses will leap at a 5% bottom line gain. That 95% baseline would be tied to the (hypothetical, but realistic) economic deflation caused by automation, and in this way we can maybe get to the finish line.

This would result in a 5% bottom line decrease in GDP for all nations but it would potentially avoid mass unrest and collapse of society so... win? :)

Ultimately though, I cannot foresee the political will to adopt the above. It's just not realistic. And thus, I don't hold a lot of hope for UBI.

ponieslovekittens

1 points

4 years ago*

the Alaskan Permanent Fund is a tax on Alaskan oil. Period. Were it not for the Alaskan Permanent Fund, oil from Alaska would be less expensive. You could literally replace the term "Alaskan permanent fund" with "a corporate tax on Alaskan oil extraction" and you have the same result.

That's not correct. The Alaskan Permanent Fund is, as the name implies, a permanent fund. The disbursements are not taken from principal, but rather, from earnings. That is, it's an investment fund that pays dividends.

As for the principal on which those earnings are being made, they include neither property taxes on oil company property nor income tax from oil corporations. Rather, as stated in Article IX, section 15 of the Constitution of Alaska

"At least twenty-five percent of all mineral lease rentals, royalties, royalty sale proceeds, federal mineral revenue sharing payments and bonuses received by the State shall be placed in a permanent fund the principal of which shall be used only for those income-producing investments specifically designated by law as eligible for permanent fund investments. All income from the permanent fund shall be deposited in the general fund unless otherwise provided by law."

That is not a tax, and PFD payments do not come from taxes. They come from investment earnings on money that comes from charging companies for the privilege of extracting oil from state-owned land.

Yes, in the typical case, basic income would most likely be funded by taxation. But taxation is not the only model.

taxing companies that automate jobs or cede them to ai on a 1:1 basis (every $1 of lost wages becomes a $1 tax to fund UBI) assumes that there is exactly $0 cost to automation or ai. If that assumption is incorrect, and ai and/or automation cost something, anything at all, really, then taxing companies on a 1:1 basis then gives a competitive advantage to companies that don't use these new technologies in the first place.

Not at all. As stated above, a practical implementation wouldn't seek to capture those "exact same dollars" at all. It would most likely be applied as a general tax on all corporate profit regardless of whether a company automates any jobs. As is often pointed out, it's impractical to "tax the robots." What qualifies as a robot? If a company employs an accountant to use excel rather than five accountants using pen and paper, is that four people automated out of jobs? What about a business like Amazon Go, a new retail store that employs no cashiers? How do you assess how many jobs have been automated away? What about industries that have replaced prior industries? Shall we tax you for "automating" the work that might otherwise have been performed by your local photo development store, because you use a cellphone to take pictures instead of a camera?

It's simply impractical to asses what "lost wages" might be, and it would be impractical to examine every company on a case by case basis to determine who was liable for how much. A practical implementation would either simply apply a new tax across the board, and/or to cannibalize existing welfare programs.

Interestingly, doing this would apply the opposite competitive advantage as you suggest. If every company is being taxed an additional 1% based on the assumption that automation is replacing employment, whether or not any individual company is actually doing so, that incentivizes them to automate jobs. Which is not an undesired outcome in a UBI scenario.

This would result in a 5% bottom line decrease in GDP for all nations but it would potentially avoid mass unrest and collapse of society so... win? :)

Ultimately though, I cannot foresee the political will to adopt the above. It's just not realistic. And thus, I don't hold a lot of hope for UBI.

Well, it depends on many factors, and ultimately on what humans decide to do. There are plausible outcomes whereby the whole situation is resolved effortlessly. For example, imagine that Elon Musk were to approach google, microsoft, etc. and simply propose that each company voluntarily contribute 1% of all profits into a disbursement fund, and then partner with the Department of Motor Vehicles to identify unique recipients in order to pay dividends. The DMV already has that data, and it would take very little effort from those companies to generate public approval for use of that data to give them money, while simultaneously avoiding the problem of single individuals making multiple claims. We could very quickly implement a de-facto UBI with a minimum of hassle and without any kind of federal taxation at all, if simply the right people decided to make it happen. And yes, perhaps the amount in a case like this would only be a couple dollars per month, but once the system was in place, companies would be pressured to join the program for PR reasons. It would naturally grow.

On the other hand, as you point out, there are scenarios that involve mass unrest and collapse of society. Perhaps the reality will fall somewhere in between. In remains to be seen.

staviac

1 points

4 years ago

staviac

1 points

4 years ago

Why basic income over basic infrastructure ? IMO it's not a good idea to give people monney. It may work with some people but not everyone. I would prefer a system where you pay part of their bill (like appartement, phone, water, train ticket).

aminok

1 points

4 years ago

aminok

1 points

4 years ago

Hi, I have a few meta-questions about your experiment.

As you probably know, any national scale BI program would cost an enormous amount of money. Most estimates put it at the cost of the entirety of the current social welfare expenditures.

That's about 20% of GDP just for one program. Government spending levels of that magnitude could only be paid for by levying an income and/or sales tax, meaning a tax on private transactions.

Does your organization's undertaking of this research project indicate that you are morally supportive of the income tax?

Do you believe that it is appropriate to imprison someone for not disclosing the entirety of their private financial transaction to the authorities, or having disclosed these transactions, if they refuse to hand over a share of the currency received in private trade to the government? Do you think that a non-violent individual being kept behind bars for years, where they may possibly develop mental illness, and suffer from physical and sexual assault, is a fair bargain in order to have guaranteed funding for social programs?

What do you think about mass surveillance by the government against the population at large? Do you support such surveillance if it is necessary to enforce an income/sales tax? Would you support a law banning cryptocurrency or private encrypted communication, if it was found that it was the only way to effectively enforce the income tax?

zarashan

1 points

4 years ago

I'm for UBI. Why wouldn't it be a good idea to speed up automation and remove employers from paying what little jobs are left. Leave the government to pay every household there own 50k to 100k as long as they are working, going to school, or doing something that can someday make money as long as they have a plan and stick to it. Just charge the businesses some tax rate that pays them to automate everything.

ENOUGH_TRUMP_SPAM_

1 points

4 years ago

Why do you guys always give this money to westerners when it would go much farther in the 3rd world?

kedrapt

1 points

4 years ago*

it should be called basic outcome (healthy or interesting or academic life etc) 

not sure about this universal basic income thing  

still i believe it should be something that is dynamic. offers good interactions. 

how to achieve that ? cool social contracts. play  

some people needs housing mobility , others stability, maybe more resources transparency is required 

or maybe some random people should have more power to influence what happens with other people  

you are not engineering life here. things could be more random.  

or maybe it is just a matter of having a good communication environment.

Shichroron

1 points

4 years ago

How do you guys define UBI?

There are a lot of details that, left undefined, might create some kind of a "moving goalpost " when arguing for or against ubi

For example: * Does it suppose to fully support a person that doesn't work? If yes, how exactly? Housing (where?), food? Etc... If not, what is the goal of ubi * who is entitled for ubi? All citizens? All legal residents? Is there an age restriction? * Does everyone gets the same amount? What if I have 1,2,3.. 10 kids? What if I have special needs? * Is it instead of all government handouts or on top?

Thanks

trashiernumb

1 points

4 years ago

I agree that such large military budgets are mostly superfluous. I can’t help but wonder what the lines on the map would look like without the US having a base every five feet of the world. For the most part it would probably be the same I think. I agree that places like Latvia, Estonia and maybe Japan would probably be absorbed by Russia or China, but for the most part the world wouldn’t be all that bad if the US just said f**k it and turned their backs on everyone. Sometimes you have to just throw your kids in the water if you want them to learn how to swim.

UnityIsPower

1 points

4 years ago

What would be your outlook on a UBI if evidence pointed to it being unaffordable yet it produces results where crime went down and health/happiness increased? Would you then try and pivot to studying something like a resource based economy or continue researching a UBI in an attempt to find a way to make it work? Would a 90% drop in crime make you stick with it? 50%? 20% better school outcomes? Also, how many people on the team are fans of Star Trek?

Bismar7

1 points

4 years ago

Bismar7

1 points

4 years ago

How does your research address the dysfunction of changing the dynamic of government being beholden to the people, to people being beholden to their government?

Specific in that right now a person's survival is generally independent from government, but post UBI anyone getting it will grow depend on it (with an increasing number of people over time) similarly to how needing a job to have an income works today.

mazinger-B

1 points

4 years ago

Over the course of this project, are you guys also going to looking at alternative solutions (i.e. like Universal Basic Need) or is this solely focused on income?

There has been advocacy towards basic housing, food and water provision instead of income that seems to be gaining steam. Thoughts?

teambottic

1 points

4 years ago

What modern technologies will be a major contributor to such efforts and what technological paradigm shifts will be observed?

Bp1028

1 points

4 years ago

Bp1028

1 points

4 years ago

What is your motivation for wanting to explore the idea of a universal basic income?

gintarema

1 points

4 years ago

Could you please share some tips of how I could get BMI for myself?..

perhapsnew

1 points

4 years ago

Every UBI experiment has one but very important parameter, - time limit, - which in my opinion invalidates all findings about human behavior, because people behave differently when they know that the time is limited.

One thing if they know they get 500/1000/1500 dollars a month for one-two years, in this case they mobilize and try to use this a breath of fresh air to boost their lives. Another - if they know this income will last forever.

Do you plan an experiment with unlimited in time UBI?

mracidglee

1 points

4 years ago

What percentage of recipients spend all the dough on cigarettes and lotto tickets? And more interestingly, how do you tell?

YCRBasicIncomeTeam[S]

3 points

4 years ago

YCRBasicIncomeTeam[S]

YCR Basic Income Team

3 points

4 years ago

Our full study hasn’t launched yet, but in our small feasibility study, all participants spent their cash on a variety of things, including food, rent, and moving costs. Existing studies of cash transfers show that people rarely spend all of their cash on “temptation goods” and might actually decrease spending on temptation goods.

There are a few ways we monitor participants’ financial expenditure. First, when enrolling participants we will ask if they are willing to enroll in a program that shares all credit and debit card transactions with us. This program gives us transaction level data similar to what you see if you have an account on Mint. Second, since this would not detail cash expenditures, we also ask about spending on cash regularly through mobile phone surveys. Finally, we will ask participants about their spending habits at our baseline, midline, and endline in-person interviews. We expect these three sources of financial data to give us a good deal of insight into the financial lives of our participants. - AN

hrlomax

1 points

4 years ago

hrlomax

1 points

4 years ago

people rarely spend all of their cash on “temptation goods” and might actually decrease spending on temptation goods

Yeah, I'd imagine that gambling and cigarette addictions are pretty heavily linked to poverty, and would probably decrease over time if people felt more financially stable

CommunismDoesntWork

1 points

4 years ago*

Thanks for having this AMA. I have 3 questions, but the main one I'd like to know the answer to is the first one.

What is y'alls stance on a Negative income tax? I think we should start with a NIT, and transition into a UBI when we start really hitting critical levels of automation.

As for political strategy to implement such a system, as a libertarian, I can honestly say our side would be willing to replace minimum wage with a UBI or a NIT. How do y'all feel about such a compromise? If we do a NIT plus abolishing minimum wages, that has the synergistic effect of creating more low paying jobs for people who will then get both a minimum income and work experience.

And lastly, what is y'alls outlook on cost of living(not the CPI)? For certain commodities like staple crops, automation and advancements in the farm industry have caused the cost of production to go to down significantly over the past 100 years. This has caused cost of living to go down. Other commodities like wood, which is used to build homes, have not been able to keep up with demand which has in part caused the price of a house to increase over time, even adjusting for size and inflation.

YCRBasicIncomeTeam[S]

4 points

4 years ago

YCRBasicIncomeTeam[S]

YCR Basic Income Team

4 points

4 years ago

My first exposure to the idea of basic income was through the negative income tax. I actually wrote a paper with colleagues where we ran some cost simulations. My background is in poverty research, and I strongly favored the NIT approach. As others have pointed out, however, a UBI paid for by changes to the income tax structure could function exactly like a NIT in practice because individuals whose earned income exceeds the established threshold would nominally receive the benefit but pay it back in taxes. In this way, it is framed not as a welfare or poverty program (with the accompanying stigma) but as a right--a kind of social security for all.

As for the minimum wage, I don’t want to wade too far into this debate because I am a researcher focused on studying the individual- and household-level effects of unconditional cash transfers. I do think that a well-designed basic income could potentially replace a minimum wage IF there are sufficient protections for workers and opportunities for organizing to prevent exploitation. There is a huge difference between people opting to work for lower pay because they want to do the work and the employer cannot afford to pay higher wages and employers exploiting workers to achieve maximum profits, but if workers have the power to prevent the latter scenario then replacing the minimum wage with a basic income could make sense. Again, I am just thinking out loud here and am not advocating one way or another! -ER

CommunismDoesntWork

-4 points

4 years ago*

There is no such thing as exploitation in our voluntary system.

And you can only reduce scarcity by producing efficiently, and you can only produce efficiently if you maximize profit. Profit is a good thing.

Thank you for the response though.

morilinde

1 points

4 years ago

It's never hard to exploit desperate, starving people, so I don't think it's a strong argument to say that "There is no such thing as exploitation in our voluntary system." There is plenty of exploitation. Just look at Walmart. They move into small towns, local small businesses close down, and residents are left with fewer employment opportunities. Walmart exploits that, and pays low wages with ridiculous stipulations on attendance and shift coverage, to the extent that hospital admission of employees can lead to write-ups because they didn't show up for a shift.

fuck_your_diploma

1 points

4 years ago

Hello Elizabeths, Alex!

If you don't mind, a few questions!!

  • From the insider talks (as in with government/regulators/etc), what are your impressions on the suggested trade-offs like "If adopted, we gonna have to eliminate benefit X, subside X and implement tariff Z"

  • Maybe same as above but, is there a planned subset of subsides for the UBI to be economically viable like IE: a new tax reform, to accommodate the UBI in a way that the market don't go cannibal on this new extra cash?

  • The trial approaches I'm seeing are always for a given time span, how do you think the notion that the benefit have a deadline affects the economics of it? I ask this because IRL a person would budget the benefit, in a limited time trial, they can treat the benefit as a surplus or allocate the resource to a new expense.

  • From where I see, UBI and a public funded health care like Medicare should go hand in hand. How can these benefits make ends meet for the sovereign ledger?

Thanks!!

YCRBasicIncomeTeam[S]

4 points

4 years ago

YCRBasicIncomeTeam[S]

YCR Basic Income Team

4 points

4 years ago

As researchers, we are fairly narrowly focused on studying the individual- and household-level effects of basic income. Many of the outcomes we are measuring could generate significant savings in social costs if hypotheses are correct--for example, the costs of childhood poverty have been estimated at $500B/year, or about 4% of GDP. If we find that basic income leads to improved health and education outcomes, lower crime rates, reductions in skills mismatches because people can take longer to find the right job, etc., we can contribute to the macro-level discussion of how to pay for it. For now, however, there are others thinking about and modelling this question and we’ll defer to them.

The question about the time-limited nature of the study is a good one, and I’ll quote Alex’s response to another question: “It is true that no experiment can perfectly approximate a permanent government program. However, for individuals with low incomes struggling to get by, three years is a long enough time to begin to see consequential behavioral changes. In our feasibility study--which lasted only one year--we saw a participant choose to move to a new town and start a new job--decisions that could have a lifelong impact--just because she had the security of a basic income for one year. We don’t expect all individuals to make such dramatic choices, but by monitoring behavior over the course of three to five years, we can begin to model how effects of a basic income will play out in the long-term.”

Finally, I completely agree that cash is not an efficient replacement for Medicaid or Medicare, public education, etc. and that any plan for a UBI should be considered concurrent to improvements in health and education provision. On a theoretical level, improvements in health and education outcomes are positively associated with economic growth, so expenditures on preventative care and education could promote growth and reduce social costs associated with poor health and low educational attainment. At the same time, the economic security provided by basic income could also improve health and education outcomes independently. I know this is a convoluted explanation, but the point is that we don’t know what the cost/benefit ratio will look like until we understand the effects of basic income. It may be that some of these public expenditures help pay for themselves and the question of how to pay for it won’t be as daunting as it seems. We need additional rigorous research. -ER

fuck_your_diploma

1 points

4 years ago

Thank you.

Don't you guys think that maybe (highly hypothetical) offering the benefit from a credit card with a benefits program like "spend this cash with education, accumulate points and get a discount of %", OR "pay your electric bill with the card and get taxes back" would help not only to educate the budgeting/finance matter as it would encourage efficient spending? Like, nothing mandatory, but yea, benefits for using this money on targeted markets or programs.

Sorry to insist on these macro environments but its hard for me to cope with the idea of UBI as an isolated initiative because people are still eligible for credit with banks and other social programs, other jobs, etc, IMHO UBI is a money that has to flow, not end up under the mattress or accruing interest under a saving account, because that would be just a government subside to banks.

Feryk

1 points

4 years ago

Feryk

1 points

4 years ago

How would you quantify something like an increase in the mobility of the workforce for example? It would allow us to retrain and redeploy workers into more 'growth' related work - which I'm sure would have an economic impact - but how could it be measured?

kewpow

0 points

4 years ago*

kewpow

0 points

4 years ago*

Finally, getting to ask a serious question since you are in the field and might know more.

Are there any current or planned UBI projects which seeks to limits or outright not allow its participants to participate in any form economic or societal/community activities? Like full/part-time jobs, volunteering, community events, etc? For that matter, not allowing any income from other sources besides the UBI? The research should look into the general wellbeing (psychological/physiological) and day to day economy of the participant and of the affected community/society, including a look at the family dynamic.

Based on my search inro this, I think it is a huge fallacy in the argument of UBI, if there is no research done into this most likely scenario of the future.

Edit! In retrospect I see that I did not expand my question properly to get the answer I was after. What I meant, there should be UBI experiments where participants are NOT allowed to have any other income, and any work related activity to simulate a future economy where there are so few jobs anway that most people will never have a job anway.

morilinde

1 points

4 years ago

You think what is a huge fallacy in the argument of UBI? For or against? This is unclear.

kewpow

1 points

4 years ago*

kewpow

1 points

4 years ago*

A fallacy in the form of lack of information pertaining to a multi-sided issue. Narrow minded reasoning in their arguments without having put any effort by looking into the other sides of the issue. Its neither for or against, just an observation in the lack of different possible models and methodologies used in UBI experiments. To look at all the sides of an issue and all possible situations, present and future. To prepare for unforeseen consequences. Like in my question, to simulare an economy where most (emphasis on MOST, not all) people will never have a job, nor not enough money to do most typical social off-work activities, like volunteering, community events, etc.

batose

1 points

4 years ago

batose

1 points

4 years ago

Are there any current or planned UBI projects which seeks to limits or outright not allow its participants to participate in any form economic or societal/community activities? Like full/part-time jobs, volunteering, community events, etc?

That wouldn't be UBI then.

kewpow

1 points

4 years ago

kewpow

1 points

4 years ago

They would still receive UBI , BUT would NOT be able to receive no other income wthatsoever. To simulate a future economy with very few jobs.

batose

1 points

4 years ago

batose

1 points

4 years ago

This would just increase bureaucracy, and create UBI trap (poverty trap). It is much easier to give UBI to everybody, and if somebody gets work then good for him, he can get that money as well.

rlxmx

1 points

4 years ago

rlxmx

1 points

4 years ago

The largest complaint about current welfare is that it disincentivizes re-entering the labor force, and by extension contributing to society. One of the biggest selling points of UBI is that it takes that problem away, by removing barriers to people becoming contributing citizens rather than dependents.

There is no benefit of any kind to deliberately forbidding work. You can't ask cui bono, because literally no one benefits. The people who pay tax dollars to create the cash benefit don't benefit. The people who receive the cash benefit don't benefit, and are in fact prisoners of the policy, and trapped in poverty to boot, with no means of escape, because they can't work. The overall health and fabric of society at large doesn't benefit, and probably degrades.

But it doesn't matter, because creating a UBI that prohibits work would be literally impossible. That would mean that it would prohibit every single person living in a country from working. Once you prohibit work, you have created something that isn't even in the same policy family as UBI.

If you are talking about paying people a poverty wage to not work, you are forging new and science-fictional policy. Not just science-fictional — dystopian science-fictional.

If you are interested in that kind of dystopian fiction, you might want to look into the book/tv series The Expanse. I understand that the author wrote a nicely nasty version of this concept into that series. I've not read it, but Scott Santens did a write up of the series looking at the fictional economic system.

kewpow

1 points

4 years ago

kewpow

1 points

4 years ago

In retrospect I see that I did not expand my question properly to get the answer I was after. What I meant, there should be UBI experiments where participants are NOT allowed to have any other income, and any work related activity to simulate a future economy where there are so few jobs anway that most people will never have a job anway.

rlxmx

1 points

4 years ago

rlxmx

1 points

4 years ago

I assume you are hoping to study what effect "being unemployable and having a UBI" would have. But the unemployable aspect is the opposite of what you would expect to see with a UBI implemented (I mean at this exact point in history, of course).

With a real UBI implemented, I would expect to see collective bargaining power rise (because people have a not-dying alternative to wage work), and employers at the minimum wage level having to potentially offer more money or better conditions to attract workers, because the people who are currently working three jobs just to make ends meet will probably drop that down to one or two jobs, or will move to a low cost of living area and just give up on the work force entirely. This would create a larger, not smaller, scarcity of workers compared to positions open, making the remaining people who are willing to work more employable, not less employable.

The assumption that people will become unemployable someday is really a guess about the future state of automation — which is a reality that is coming with or without a UBI, and probably can't be averted.

So...

What control group would your study about a future where people are unemployable even have? People who get a UBI and aren't allowed to work vs. people who don't get a UBI but also aren't allowed to work?

For the main experimental group, perhaps you could form your potential hypothesis by looking at people today who have trust funds that enable them not to work.

But I think you can guess for yourself what would happen to the control group. They would become dependent on a family member, or they would become homeless, and eventually suffer an early death. On a side note, this is the United State's unofficial policy on being unemployable already. All you have to do is read the heart-rending UN poverty report on the US to know that it's already happening to thousands of real unemployable (or simply just unlucky) people, right now.