6 ms·
What would happen if we randomly gave $1,000 to poor families? Now we know
- mymacbook 7y agoLink to actual study: http://emiguel.econ.berkeley.edu/assets/miguel_research/88/GE-Paper_2019-11-20.pdf http://emiguel.econ.berkeley.edu/assets/miguel_research/88/G...
- xyst 7y agoThanks for the study, getting pay walled. Will have to read this later. Side note: on mobile, the papers in line citations are anchored to the individual reference (tapping the citation redirects user to reference). This is a pretty neat feature. Hope more people start to use it.
- bovine3dom 7y agoThe originally linked article is quite misleading regarding the multiplier: > But this study found a much bigger impact: Every $100 given directly to the poorest households was generating between $250 and $270 in GDP. That’s a fiscal multiplier in the range of 2.5 to 2.7 [...] The paper itself states 2.6 +/- 1.5 which is a huge range of possible values. It sounds like the article is instead quoting the central estimates for income and expenditure. The paper says that they're sure the multipliers are greater than 0 only at the 10% significance level. So thanks for linking to the paper!
- taurath 7y agoMaybe instead of doing share buybacks to transfer .9% of the value to shareholders, major conglomerates could just give money to poor people to spend on their products.
- throwGuardian 7y agoOr rich software engineers who consider themselves to be socially progressive, should give their money to the poor, instead of into 401Ks. Because, who knows if the company managing the the 401K is backing share buyback programs of the Apples of the world
- taurath 7y agoI can help 2, maybe 3 people, and retire without any assets. Not saying buybacks are the root of all evil, but if companies could give a crap about their employees or communities they might increase wages.
- bovine3dom 7y agoBroadly, 20% of GDP already goes on welfare [1]. Government tax take is about 40% of GDP [2], so about half the taxes that corporations "pay" [3] already go to poor people to spend on their products in some sense (if we neglect benefits-in-kind). I'm sure companies would love to be able to give poor people vouchers rather than paying their taxes but I don't think that's a great idea. This study is primarily saying that cash is great because it's fungible. [1]: https://data.oecd.org/socialexp/social-spending.htm https://data.oecd.org/socialexp/social-spending.htm [2]: https://data.oecd.org/gga/general-government-revenue.htm https://data.oecd.org/gga/general-government-revenue.htm [3]: scare quotes are because all taxes ultimately fall on human beings, whether that be through shareholdings (pensions), suppressed wages or higher prices.
- JamesBarney 7y agoThat 20% includes a lot of social spending that isn't necessarily spent on the poor like social security and medicare.
- abraCadabstrax 7y agoFamed anthropologist James Ferguson wrote a pretty thorough read that breaks down the arguments on both sides that was also reviewed by the Washington Post: https://www.washingtonpost.com/news/monkey-cage/wp/2015/07/24/this-book-will-change-the-way-you-think-about-cash-transfers-for-the-poor/ https://www.washingtonpost.com/news/monkey-cage/wp/2015/07/2...
- Paraesthetic 7y agoPaywall, fan-tastic
- orionblastar 7y agoIf they have children, most likely they got at least $1000 in refunds on their taxes. Since they are poor they get most of their FICA back on their return. I use Turbo Tax to help out people in my area who don't even know how to use a computer. Most of them are poor and I do it for the cost of Turbo Tax and the fees they charge.
- topologistics 7y agoI'm not familiar with Kenyan tax returns, do they have some law that is analogous to the Federal Insurance Contributions Act or are you just making stuff up?
- dannyr 7y agoSeems like the commenter thought that this was in the US which means the commenter didn't read the article.
- IXxXI 7y agoTax cuts are the best way to put $$ in the hands of the poor. Raising taxes on the poor, to "give them" more money as proposed by UBI is a terrible policy no matter what this or any other study says.
- gdubs 7y agoWhy?
- IXxXI 7y agoGovernments are the largest, most inefficient and wasteful monopolies in the world. There's zero incentive for them to provide cost effective or reliable solutions to problems. Private sector alternatives are better the large majority of the time.
- lemcoe9 7y agoYeah that worked very well with Goldman Sachs, Morgan Stanley, AIG, S&L's in the 90's, General Motors, Chrysler, etc. The Eisenhower National System of Interstate and Defense Highways, Hoover Dam, and similar projects were all complete failures. /s
- IXxXI 7y agoBill Clinton repealed glass steagall in 1999. It allowed that 08 bank meltdown to occur. General Motors and Chrysler business culture of excess led to their financial troubles around the same time. Hoover Dam? NASA doesn't even build its own rockets anymore. SpaceX does the job better and more affordably. The united states is the only major power in the world that fails to upgrade its aging amtrak system in favor of high speed rail. How many trillions did the state waste on war and failed projects like the F-35 and obamacare. Imagine what someone like Elon Musk could accomplish with $1 trillion in funding.
- deleted 7y ago[deleted]
- Y-Bopinator 7y agoThis basically proves that UBI works. #YangGang #YangBux