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> This experiment will give a rough estimate of the sign and magnitude of any disemployment effect: will it cause some people to drop out of the work force? Or

• _rpd 11y ago
  Yes, exactly. Instead of "Economic Perturbations Caused By Basic Income," the experiment will study "Economic Perturbations Caused By Mass Local Windfalls." In my mind, the psychological, sociological and economic responses are very different, and the main result of the experiment will be that supporters and opponents will use different sets of assumptions to map the results to a genuine Basic Income scenario, yielding much heat and little light.
  • scarmig 11y ago
    By that standard, there's no possible experiment that would give any valuable information at all, short of doing a full implementation. And even a full implementation of a basic income wouldn't actually give any information on the results of a "true" basic income, because no government can guarantee the delivery of a basic income indefinitely. The answer to "what are the effects of a basic income" isn't a single scalar value, but more of a function on the size, population, and duration of the income. What you seem to be asserting is that there's a discontinuity or inflection point in that response function, and this experiment probes the wrong side of it. Which is fair enough. But the results with t=2 gives us some information about t=3, just as the results with t=30 give us at least some idea of the results of the minimum income taken for an infinite duration. It's irresponsible and politically impossible to jump in at t=30, though, so we take baby steps, as they say, and gradually build our base of knowledge. I suppose your argument might be "well, we need to do a test of t=5 to provide any additional information over previous limited rollouts of a basic income," but I'd argue that previous experiments have been pretty different and existed in a different social context. Other interested economics and policymakers certainly agree, hence Finland running this experiment.
    • _rpd 11y ago
      My suggestion is that they are different sets of curves. We're interested in the properties of ice, and they are going to study the properties of tap water that has been put in the refrigerator for half an hour. You and I will have delightful conversations attempting to divine the properties of ice from chilled water, but political activists will declare ice fully characterized and of low viscosity while denouncing the "phase change" theory as a bourgeois boogieman. Inflationary spirals are no joke. Some degree of caution is in order before deliberately engineering one.
      • Ntrails 11y ago
        Can you briefly run through how this will engineer an inflationary spiral? With no information on the replacement ratio this offers vs existing social security costs, and no indication of how it would be funded in a full implementation I can't see the inevitability.
        • _rpd 11y ago
          The basics are that the price of inelastic goods (housing, food) will rise to absorb any disposable portion of basic income, resulting in calls for increased basic income (using "living wage" rhetoric) and a positive feedback loop. I'm assuming inelastic goods aren't price controlled (creates intolerable shortages) and that basic income does increase disposable income. There are revenue neutral versions of basic income sometimes proposed by conservatives - dismantle social security and distribute the proceeds - but I don't think those versions are what most advocates have in mind when they call for basic income.
      • scarmig 11y ago
        Well, since phase changes are just discontinuities in some thermodynamic variable, I think it's fair to say we're in violent agreement =) I take your point that political activists will misuse any information that comes from this, but they'll misuse anything, even--or especially--the lack of evidence, so I'm not sure that's compelling one choice or another.