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The New Zealand Treasury did a basic analysis on a Guaranteed Minimum Income a while ago (2010) that's a good read, with a lot of actual numbers crunched: http

by Nition 10y ago

The New Zealand Treasury did a basic analysis on a Guaranteed Minimum Income a while ago (2010) that's a good read, with a lot of actual numbers crunched: http://igps.victoria.ac.nz/WelfareWorkingGroup/Downloads/Working%20papers/Treasury-A-Guaranteed-Minimum-Income-for-New-Zealand%20.PDF http://igps.victoria.ac.nz/WelfareWorkingGroup/Downloads/Wor...

TheSpiceIsLife 10y ago
For those of us too lazy to click a link, would you mind providing a summary or a few dot-points of interest.
- gallerdude 10y ago
  From a table within the source: Benefits:  More equal distribution of income  Removes disincentive for beneficiaries to undertake part-time work  Poverty is reduced but only at the 60 and 70 percent relative levels (2, 2A)  May improve labour market outcomes in some areas: more employee flexibility; encourages unpaid work; additional employee bargaining power; encourages entrepreneurial activity; and reduces the opportunity cost of full time training or education.  Lowers administrative, management and operating costs Costs:  Poverty is either increased across all relative levels as Superannuitants have their payment decreased by 44% on average (1), or is increased when measured at the 50 percent relative level (2, 2A).  Horizontal equity problems due to differential treatment of one and two parent families  Many current beneficiaries (e.g. sole parents, the disabled and carers) will be financially worse off under the scheme  Reduces the supply of labour: decreases hours worked; increases migration of skilled workers; discourages people from taking entry level jobs; discourages further education and training; and the EMTRs for families with children are very high discouraging further work, MFTC (1, 2).  High personal income taxes have negative implications for saving, investment and productivity  Lowers economic growth (estimated at 2.8 percentage points per year)  Non-alignment causes integrity and coherence issues for the tax system
  - disordinary 10y ago
    It's interesting that they think it will be a disincentive to work, $300 is less than the benefit now when you include the accommodation supplement and quite a lot less if you include training incentive allowance, emergency cash, food allowances, etc. Yet people still work. I wonder if it would actually be the opposite, with people being able to work legitimately rather than under the table to supplement their income (and not have to fake ACC injuries).
    - Nition 10y ago
      I don't think the study is really sure what effect it would have either. Sure they have "discourages people from taking entry level jobs" under Costs (and they don't really elaborate much more in the main text), but they also have "Removes disincentive for beneficiaries to undertake part-time work" under Benefits. At the moment when you're on the unemployment benefit there's a lot of pressure to look for and acquire a job. The lack of that pressure might be a factor in reducing the incentive to get an entry-level job. Or it might be the opposite - an incentive - because you won't lose your benefit when you get one! It's complicated - the sort of thing that probably needs to be tested in a real-life trial. Too bad it'd be so hard to set up (and potentially revert) at a government level. If only we had a perfect computer simulation of a country. There'd be so many knock-on effects. Like say you get your $300/wk, and you don't have a job with a company - is there going to be a big exodus from the cities since it's too expensive to live there on a UBI scheme? And you only NEED to be in the city if you have a job there.
      - disordinary 10y ago
        It depends on the benefit, I've known quite a few people who have been on the artists benefit and there is no pressure to look for a job there. People will still gravatate towards cities because that's what we do. However a little easing of the pressure on the three main cities would do wonders, as we know the cost of housing is out of control. With the fibre rollout we'll also see the requirement to live in a city is limited, if you can get 100Mb/s and work from home in the Waiarapa why would you bother living in Lower Hutt and face that commute to Wellington?
- iamshs 10y ago
  Here:- https://i.imgur.com/VZAFXWi.png https://i.imgur.com/VZAFXWi.png For giving $300/week to all 16+ years old citizens. Poverty increases because higher taxes have to be levied on income earners (PDF says 44-48.6% range). Single person householders with >$50K; Two-earner households with children earning over >117K; Single income families earning >$183K are worse-off as it will reduce their disposable income. The main worry is people will work less for the time that fetches them $300/wk but the upside is that people will be more willing to take on part-time work; also people might shun entry-level jobs; increase in emigration due to increase in taxes; while immigration from unskilled labour will increase. Brief 5 min look-through synopsis. Please correct if it seems insufficient.
- Nition 10y ago
  As others have said aleady, the table at the end (https://imgur.com/VZAFXWi https://imgur.com/VZAFXWi) is a pretty good summary on its own. This was a fairly limited study in that it only looked at a couple of simple ways of doing things, but I do think it's a good analysis to read. There's still a lot more actual number-crunching in it than you'll find in the average Internet discussion. I've also come across a fairly thorough rebuttal to the whole thing in a blog post here, which might be interesting supplementary reading: http://www.oursystem.info/2011/11/gmi-response-to-treasurys-economic.html http://www.oursystem.info/2011/11/gmi-response-to-treasurys-...
disordinary 10y ago
That would have been about the time that Don Brash was commissioned to write a report on how to grow the economy and his suggestion was to lower the average income... Two very different approaches. Labour and the Green party have both shown an interest in UBI so it will be interesting to see if it comes up as policy during the elections next year.
kwhitefoot 10y ago
Did they analyse an actual Guaranteed minimum Income trial or is this a paper exercise? As far as I know the experiments that have been done (one in Canada and two in the US) concluded that only people in a few specific circumstances worked less (single mothers in particular I think).
- Nition 10y ago
  It's a paper exercise by the Treasury, which is an institution that advises the NZ government on economic and financial policy.

by Nition 10y ago

TheSpiceIsLife 10y ago

For those of us too lazy to click a link, would you mind providing a summary or a few dot-points of interest.

gallerdude 10y ago
From a table within the source: Benefits:  More equal distribution of income  Removes disincentive for beneficiaries to undertake part-time work  Poverty is reduced but only at the 60 and 70 percent relative levels (2, 2A)  May improve labour market outcomes in some areas: more employee flexibility; encourages unpaid work; additional employee bargaining power; encourages entrepreneurial activity; and reduces the opportunity cost of full time training or education.  Lowers administrative, management and operating costs Costs:  Poverty is either increased across all relative levels as Superannuitants have their payment decreased by 44% on average (1), or is increased when measured at the 50 percent relative level (2, 2A).  Horizontal equity problems due to differential treatment of one and two parent families  Many current beneficiaries (e.g. sole parents, the disabled and carers) will be financially worse off under the scheme  Reduces the supply of labour: decreases hours worked; increases migration of skilled workers; discourages people from taking entry level jobs; discourages further education and training; and the EMTRs for families with children are very high discouraging further work, MFTC (1, 2).  High personal income taxes have negative implications for saving, investment and productivity  Lowers economic growth (estimated at 2.8 percentage points per year)  Non-alignment causes integrity and coherence issues for the tax system
- disordinary 10y ago
  It's interesting that they think it will be a disincentive to work, $300 is less than the benefit now when you include the accommodation supplement and quite a lot less if you include training incentive allowance, emergency cash, food allowances, etc. Yet people still work. I wonder if it would actually be the opposite, with people being able to work legitimately rather than under the table to supplement their income (and not have to fake ACC injuries).
  - Nition 10y ago
    I don't think the study is really sure what effect it would have either. Sure they have "discourages people from taking entry level jobs" under Costs (and they don't really elaborate much more in the main text), but they also have "Removes disincentive for beneficiaries to undertake part-time work" under Benefits. At the moment when you're on the unemployment benefit there's a lot of pressure to look for and acquire a job. The lack of that pressure might be a factor in reducing the incentive to get an entry-level job. Or it might be the opposite - an incentive - because you won't lose your benefit when you get one! It's complicated - the sort of thing that probably needs to be tested in a real-life trial. Too bad it'd be so hard to set up (and potentially revert) at a government level. If only we had a perfect computer simulation of a country. There'd be so many knock-on effects. Like say you get your $300/wk, and you don't have a job with a company - is there going to be a big exodus from the cities since it's too expensive to live there on a UBI scheme? And you only NEED to be in the city if you have a job there.
    - disordinary 10y ago
      It depends on the benefit, I've known quite a few people who have been on the artists benefit and there is no pressure to look for a job there. People will still gravatate towards cities because that's what we do. However a little easing of the pressure on the three main cities would do wonders, as we know the cost of housing is out of control. With the fibre rollout we'll also see the requirement to live in a city is limited, if you can get 100Mb/s and work from home in the Waiarapa why would you bother living in Lower Hutt and face that commute to Wellington?
iamshs 10y ago
Here:- https://i.imgur.com/VZAFXWi.png https://i.imgur.com/VZAFXWi.png For giving $300/week to all 16+ years old citizens. Poverty increases because higher taxes have to be levied on income earners (PDF says 44-48.6% range). Single person householders with >$50K; Two-earner households with children earning over >117K; Single income families earning >$183K are worse-off as it will reduce their disposable income. The main worry is people will work less for the time that fetches them $300/wk but the upside is that people will be more willing to take on part-time work; also people might shun entry-level jobs; increase in emigration due to increase in taxes; while immigration from unskilled labour will increase. Brief 5 min look-through synopsis. Please correct if it seems insufficient.
Nition 10y ago
As others have said aleady, the table at the end (https://imgur.com/VZAFXWi https://imgur.com/VZAFXWi) is a pretty good summary on its own. This was a fairly limited study in that it only looked at a couple of simple ways of doing things, but I do think it's a good analysis to read. There's still a lot more actual number-crunching in it than you'll find in the average Internet discussion. I've also come across a fairly thorough rebuttal to the whole thing in a blog post here, which might be interesting supplementary reading: http://www.oursystem.info/2011/11/gmi-response-to-treasurys-economic.html http://www.oursystem.info/2011/11/gmi-response-to-treasurys-...

disordinary 10y ago

That would have been about the time that Don Brash was commissioned to write a report on how to grow the economy and his suggestion was to lower the average income... Two very different approaches. Labour and the Green party have both shown an interest in UBI so it will be interesting to see if it comes up as policy during the elections next year.

kwhitefoot 10y ago

Did they analyse an actual Guaranteed minimum Income trial or is this a paper exercise? As far as I know the experiments that have been done (one in Canada and two in the US) concluded that only people in a few specific circumstances worked less (single mothers in particular I think).

Nition 10y ago
It's a paper exercise by the Treasury, which is an institution that advises the NZ government on economic and financial policy.