FYI the April 13 show of the Freakonomics Podcast takes on the question "Is the World Ready for a Guaranteed Basic Income?" and mentions some of the prior studies noted in this article.
http://www.npr.org/sections/money/2013/11/08/243967328/episo...
http://www.npr.org/sections/money/2013/08/16/212645252/episo...
Overall the basic income idea... I don't like it in a lot of ways, I just can't see it resulting in a productive society personally. But that's just my gut reaction and I could be wrong, so far the data I've seen is a pretty mixed bag.
I think things like this are a great way to experiment with it though (and without tax payer money). I might change my mind if there's more good data.
Or maybe everything I've said is bullshit. Who knows? Only one thing is for sure: without experimentation, we only hurt ourselves in the long run.
Empirically, people often expend effort to increase their income when there are opportunities available, even if their current income meets basic survival needs. I don't see why that wouldn't continue to be the case with basic income. What, people are going to stop wanting luxuries?
Not sure about you, but most of the luxuries I own, I've basically only bought because I had money for them. If I didn't have money to blow on them, they really don't bring me that much joy, relatively basic items would suffice.
So many things I think of as the real luxuries these days are free or basically free. I can spend hours watching youtube or playing games for extremely little cost.
I would not exert extra effort to buy better phone or a 4k monitor and a 980ti instead of settling for a weaker setup. Instead I only have these things because the money was there already and I had nothing better to do with it.
Basically, I'd drop out of the workforce in a heartbeat if I could afford living and a few minimal luxuries. $15-20k/year would do the job to split a cheap apartment with a friend and keep the rest under control. This is half of what some people have proposed as a UBI.
Do we actually have evidence for this? If you're comparing working a skilled vs unskilled labor I think there's a lot more difference than just pay there that must be considered. In a lot of ways the skilled job is lower effort, even if the up front effort requirement was higher, the daily effort requirement is often lower.
You also have to consider than even a relatively low effort job 8 hours a day is a massive effort difference from zero, which is the alternative you're actually comparing to. Basically, if you need to exert several hours a day worth of effort to get by, you better optimize the value you get back from them. But if you don't need to exert any at all to get by, that's a very different situation.
But maybe I'm just an uncommonly lazy turd. It's possible. I just don't have evidence to say it for certain.
By the way this might be very doable for you on a short timescale, if you pull in the kind of salary most people do on HN. Studies show that if you retire and pull only <4% of your starting balance each year to live off, you can live off it for 30+ years, if not indefinitely. If you were earning $120k, but only spending $20k/yr, you'd have enough wealth to live off after only 7.5 years.
Yes, check out /r/financialindependence
There's thousands of people living frugally to retire early with ~1-2 million which is basically UBI over a lifetime
I worry that it would be a lot worse than that - that we could create a class of non-workers and workers. Some products would only be affordable to workers and if, like you're saying, those workers are only those working high paying jobs, this is probably how it'd work out. It could perpetually shrink the labor force while forcing those people who aren't working into a lower class in society and overall dropping our productivity at large - setting back the kinds of automation that such a society could require.
Personally I'd almost immediately attempt to drop out of the workforce. And well, software developers are often pretty heavily involved in this sort of automation. So maybe I'm just speaking to my own situation here more than anything.
Of course, this is only speculation, and probably one of the worst possible outcomes I can envision for such a program.
I definitely agree with you about experimentation though, and if the main funds for it are coming from donors voluntarily and not out of the tax payer's pockets then that's all the better. It would be great to have both private and public researchers in on this though, I'll take as many eyes as we can get on the data.
UBI is intended to alleviate the problem with means-tested social welfare programs in doing that by reducing the disincentive to taking action which would produce additional income faced by those on means-tested benefits where any additional income results in substantial (sometimes even dollar-for-dollar or greater) reduction in value of benefits received.
And, in any case, economically its somewhat self-limiting (unless you explicitly inflation index the benefit, in which case you are just asking for disaster if you set it wrong initially -- which is why I prefer tying benefits to a defined revenue stream, rather than a set benefit level): if too many people drop out of the work force because the benefit level is too generous given the current level of productivity, it will accelerate inflation, reducing the real level of the benefit, leading more people back into the workforce.
You can be 100% sure that unless this is specified you'll have people lobbying for it every year. Or just flat rate increasing the UBI, etc. I can envision a strong push from some political groups for this already.
> if too many people drop out of the work force because the benefit level is too generous given the current level of productivity, it will accelerate inflation, reducing the real level of the benefit, leading more people back into the workforce.
This is a good point, but in this case, everyone essentially loses value from savings to pay the UBI. Definitely not a hit I'm interested in taking.
I'd really prefer to take strong steps to eliminate the risk of overshooting a sustainable benefit level, but -- while there are certainly costs to that -- the "mass exodus from the work force because benefits are too generous" problem is self-limiting.
But I can't help but think that it'll be too politically charged to follow any sort of logical regime that might result from research, which makes it sort of scary to approach. You'd basically need the public to agree on the terms and limits of a well-defined system without turning it into a partisan mess. Unfortunately I can't think of many examples of this currently in existence.
And the effect you describe is really one of overall domestic spending, not one program in isolation.
How do you figure? If that were true then that means companies are currently thinking "I could automate all these human jobs, but these guys need work so I won't"?
Not sure I've ever heard a business make that decision.
Increasing the cost of labor increases the incentive for automation to remove the need for the labor.
Different UBI proponents (which come from across the left-right spectrum) have different ideas, but none of them that I've heard from has favored UBI for the purpose of increasing the cost of labor generally. Especially on the right, but also usually on the left as well, reducing the disincentive to work inherent in means-tested social benefit programs, and avoiding the same problems that minimum wages seek to address while not limiting the minimum economic value a job can produce and be worth offering are frequently cited motivations.
But is this still an effect which needs to be considered? I can only see it increasing the cost of labor if people are only willing to work for the luxuries they desire and no longer for the basic living expenses.
By what other means would it encourage automation at all? Or is that not an intention or benefit at all?
Its not really intended to encourage automation, from what I've seen from most proponents; the relation to automation is that automation is happening now, and expected to continue with or without UBI. Proponents of UBI (particularly on the left) see this trend as a significant contributor to declining real wages for most workers, with the gains from the growth of the economy going to a relatively narrow set of elite workers and, even moreso, a much narrower set of capitalists. They see UBI as a means of compensating for the harm most workers experience in this, redistributing some of the net gain so that the aggregate gain that these changes contribute to benefits everyone. Productivity increases don't need to be encouraged, they inherently produce their own reward.