Can Behavioral Economics Address Income Inequality?

In response to concerns that new technologies such as robotics and artificial intelligence will have a detrimental impact on jobs and wages for human workers, a growing number of policy analysts have called for consideration of a Basic Income Guarantee (BIG), which involves a tax-free, subsistence-level, income paid directly by a government to individuals or households with few or no conditions. While many opponents of BIG programs believe that receiving guaranteed subsistence income would act as a strong disincentive to work, various areas of empirical research in psychology (studies of intrinsic motivation; non-pecuniary benefits of work on social identity and purpose; and reactions to financial windfalls such as lottery winnings) suggest that a BIG would not lead to meaningful reductions in work. To test these competing predictions, a comprehensive review of BIG outcome studies reporting data on adult labor responses was conducted. The results indicate that 93% of reported outcomes support the prediction of no meaningful work reductions when the criterion for support is set at less than a 5% decrease in either average hours worked per week or the rate of labor participation. Overall, these results indicate that adult labor responses would show no substantial impact following a BIG intervention.

2009

The Ethics and Economics of the …, 2005

International Journal of Environment, …, 2006

This paper argues that the US welfare system needs to move away from conditionality and toward a Basic Income Guarantee (BIG). It discusses the definition of poverty and the goal of poverty policy. It critically examines five theories of the causes of poverty: the physical inability to work, single parenthood, inadequate demand for labour, inadequate human capital, and a poor work ethic. It critically discusses six policy strategies for fighting poverty: promotion of economic growth, workfare, the minimum wage, separating the 'deserving' from the 'undeserving' poor, publicly guaranteed employment, and the Basic Income Guarantee. It assesses how well each of these programmes addresses the five proposed causes of poverty, making the case that the most efficient and effective of these is the Basic Income Guarantee.

Basic Income Studies, 2018

Many opponents of BIG programs believe that receiving guaranteed subsistence income would act as a strong disincentive to work. In contrast, various areas of empirical research in psychology (studies of intrinsic motiva- tion; non-pecuniary benefits of work on social identity and purpose; and reactions to financial windfalls such as lottery winnings) suggest that a BIG would not lead to meaningful reductions in work. To test these compet- ing predictions, a comprehensive review of BIG outcome studies reporting data on adult labor responses was conducted. The results indicate that 93 % of reported outcomes support the prediction of no meaningful work reductions when the criterion for support is set at less than a 5 % decrease in either average hours worked per week or the rate of labor participation. Overall, these results indicate that adult labor responses would show no substantial impact following a BIG intervention.

Review of Social Economy, 2005

International Social Security Review, 2008

The article discusses whether the likelihood of Germany introducing a basic income policy -that is independent of labour market participation -has increased in recent years. A brief description of the main elements of the German welfare state is followed by a critical analysis of more recent developments in guaranteeing a basic income, not least with the 2003 merger of unemployment benefits and social assistance. Since then the resulting fears of downward mobility felt even by the middle classes have reignited the 1980's debate about a basic income. Two models (the "basic income guarantee" and the "solidarity citizen's income") are used to discuss practical system design problems and the chances of realizing a basic income policy.