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Study: Basic income would not reduce people's willingness to work:
A basic income would not necessarily mean that people would work less. This is the conclusion of a series of behavioral experiments by cognitive psychologist Fenna Poletiek, social psychologist Erik de Kwaadsteniet and cognitive psychologist Bastiaan Vuyk. They also found indications that people with a basic income are more likely to find a job that suits them better.
The psychologists received a grant from the FNV union to research the behavioral effects of a basic income. They simulated the reward structure of different forms of social security in an experiment. "We got people to do a task on a computer," says De Kwaadsteniet. "In multiple rounds, which represented the months they had to work, they did a boring task in which they had to put points on a bar. The more of these they did, the more money they earned."
The psychologists researched three different conditions: no social security, a conditional benefits system and an unconditional basic income. De Kwaadsteniet: "In the condition without social security, the test participants didn't receive a basic sum. In the benefits condition they received a basic sum, which they lost as soon as they started working. In the basic income condition they received the same basic sum but didn't lose this when they started work."
The basic income did not cause a reduction in the participants' willingness to work and efforts, say the psychologists. Nor did their salary expectations increase. "In the discussion on a basic income, it's sometimes said that people will sit around doing nothing if you give them free money," says Poletiek, who saw no indications of such a behavioral effect.
What would you do if you were to receive a basic income?
(Score: 0) by Anonymous Coward on Sunday January 23 2022, @07:18PM
- snip mention of Mosler -
There are two different topics at hand here. First is the job guarantee: that a job is available to all people who want one. Second is the goal of monetary policy as full employment: that the money supply is stoked to juice the economy to the point that availability of labour is a limiting factor. Because MMT divorces the concept of the expenditures and revenue streams of the government in a fiat currency world, the idea is that you end up with a monetary policy that, by current standards, is considered to be quite generous, which is why you end up with persistent inflation. MMT's response to this is to withdraw money from the money supply with taxes and financial sinks such as bond issues, but if you juice those so hard that you tame inflation, you end up with a basal degree of unemployment. Now, if you use the MMT concept to boost national expenditures through a UBI that functions as an all-in safety net (covering housing, food, medical care, clothing and other necessities) you have a big, chunky budget spewing money like a firehose all over the economy. The result is that you have to either tax like a lemon juicer, or you have to borrow like a coke fiend, or you have to accept the kind of inflation that will make zimbabweans nostalgic. Remember how everything in an economy is connected? Now you have to determine what constitutes full employment in your UBI-supported community. If you're willing to accept the idea that having a UBI in your bank account is functionally equivalent to employment, you can tune your monetary policy to tame inflation, but then you have monumental tax burdens.
To put it another way: in the current system the central bank's job is to target a balance between full employment and inflation, using money supply as their tool. Under MMT proposals the idea is to target full employment by monetary policy, and then have fiscal policy balance inflation, and hand-wave away the inevitable links between monetary and fiscal policy, reducing the central bank to a printing facility for the government.
Sure, and if we were all robots instead of people things could be extremely different, but they're not. Economics is not just price/demand/supply/cost analysis, but we also have fields including behavioural and political economics. If you ignore the human dimension of how countries run, you're blinding yourself to the question of feasibility. This is squarely in the realm of economic theory, just not economics 101 any more. Again, look at cases such as Veblen goods which make little or no sense until you add the human dimension.
- snip commentary on bullshit jobs -
Part of the problem that I pointed out earlier was that precisely when you start to tax wealth, that includes assets such as all your automation facilities. At that point, employing people becomes the cheaper option because UBI functions like a monumental subsidy to employment - but it is also a drag on employment because the baseline option lets people be so selective about employment that getting people to do the hard, heavy stuff (I used reaping crops as an example) is not something that most people want to do. Now you have primary industries caught between punishing taxes and a demotivated workforce, thus a reduction in the functional value of the labour subsidy, meaning that the prices of those primary inputs (say, wheat) rise meteorically compared to the UBI, making for a big inflation driver.
No. Here your numbers are just wrong. Sure, you're right that not literally everybody has moved from California, but even with the marginal cost structure between California and Oklahoma there has been a lot of movement. For example https://www.postalley.org/2020/08/24/american-migration-where-people-are-moving/ [postalley.org] shows quite clearly that California is driving a lot of people out - a trend that has continued strongly since that article was written, which is part of why NY and CA and MA and NJ authorities are salty about SALT deductions.
Bear in mind that all this is covered by the relatively narrow margin in total cost of living between various states, and relatively minor net differences in local taxes, even after the expenses of moving! Multiply that by a whole country going balls-deep on heavy taxes and basically running the bottom of Maslow's Hierarchy as a government programme, and it goes nuts.
As for SS/MC defunding paying for UBI, you're completely wrong. With about a third of a billion (actually more) people in the USA, your average payment to each one to meet the basics (ignoring expensive pockets like Manhattan and the Bay Area) is north of $10K/year - more than $20K/year if you're including medical, and all people of all ages from cradle to grave. So we're talking 6 trillion every single year. That's about a third of GDP, and about double the current US tax take - and way over the equivalent social services, even if you throw in Medicare, Medicaid and the VA system.
And this is where political economics meets macroeconomics: people wouldn't dislike it just because it's icky and makes them worry about cooties. They'd dislike it because once you start counting on your fingers you realise very quickly that the strain it would put on the economic system is beyond disruptive. You'd need either a lot of fanatics with guns, or a huge coalition of very rich, very committed people to back it to the hilt.
... more to come because of the lameness filter ...