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Basic income makes sense to me as a more effective implementation of welfare, but I personally strongly prefer the negative income tax implementation: https://m

Basic income makes sense to me as a more effective implementation of welfare, but I personally strongly prefer the negative income tax implementation: https://mitsloan.mit.edu/ideas-made-to-matter/negative-income-tax-explained https://mitsloan.mit.edu/ideas-made-to-matter/negative-incom... That seems to address many of the concerns that people are raising in this thread. Namely, it doesn’t require you to work, but ensures that you never have a disincentive to work either.

lonelappde 7y ago
Money is fungible. UBI + progressive income tax is the same as negative income tax plus UBI to cover people with 0 income. The parameters matter not the name of the model. Also we already have EITC negative income tax in US. So negative income tax is either irrelevant rewording or cruel to people who can't work.
contravariant 7y ago
Mathematically they're entirely equivalent. Although I'd be inclined to agree that negative income tax might be the better model, as it gives the most direct control over the net-income vs gross-income curve, and it's the properties of that curve that drives people's behaviour. For instance the steepness of the curve indicates how much someone is incentivized to earn more (ideally you'd want this to decrease strictly monotonically as people earn more, but somehow this is rather controversial). And its curvature dictates whether a stable or unstable income incurs more tax (this property doesn't seem to be used much but it's still interesting). One of the problems with income dependent welfare is that it messes up the lower end of the curve, making its slope smaller or even negative. In the worst case it provides a financial barrier to people on welfare to re-enter the work force.
chillacy 7y ago
They can be made the same: https://taxfoundation.org/universal-basic-income-ubi-means-tested-transfers/ https://taxfoundation.org/universal-basic-income-ubi-means-t... I think UBI has advantages in its universality, where it's not perceived as a rich to poor transfer (even though it really is) and everyone feels they benefit from the program (even though some people don't).

lonelappde 7y ago

Money is fungible. UBI + progressive income tax is the same as negative income tax plus UBI to cover people with 0 income. The parameters matter not the name of the model. Also we already have EITC negative income tax in US. So negative income tax is either irrelevant rewording or cruel to people who can't work.

contravariant 7y ago

Mathematically they're entirely equivalent. Although I'd be inclined to agree that negative income tax might be the better model, as it gives the most direct control over the net-income vs gross-income curve, and it's the properties of that curve that drives people's behaviour. For instance the steepness of the curve indicates how much someone is incentivized to earn more (ideally you'd want this to decrease strictly monotonically as people earn more, but somehow this is rather controversial). And its curvature dictates whether a stable or unstable income incurs more tax (this property doesn't seem to be used much but it's still interesting). One of the problems with income dependent welfare is that it messes up the lower end of the curve, making its slope smaller or even negative. In the worst case it provides a financial barrier to people on welfare to re-enter the work force.

chillacy 7y ago

They can be made the same: https://taxfoundation.org/universal-basic-income-ubi-means-tested-transfers/ https://taxfoundation.org/universal-basic-income-ubi-means-t... I think UBI has advantages in its universality, where it's not perceived as a rich to poor transfer (even though it really is) and everyone feels they benefit from the program (even though some people don't).