Universal basic income (UBI), also known as citizen’s basic income, is a government program for individuals (or adult citizens) to receive certain amount of money regularly to meet their basic needs without any test or requirement.
Pros and Cons of Universal Basic Income
- Compared with traditional welfare projects, UBI is simpler and more efficient to policymakers
- UBI can reduce inequality and help people get out of poverty
- People receiving UBI can bargain for a better job since they basic needs are guaranteed
- Low-income groups may have the opportunity to pursue further and higher education
- UBI may help people get out of the poverty trap
- The guaranteed payment will be received by the recipients in cash or deposited in their bank account instead of in the form of coupons or vouchers, which saves the trouble of bureaucracy
- Countries with low birth rates may use UBI as a financial incentive to encourage young couples to have children
- The impact of economic downturn may be partly offset by UBI
- UBI may reduce people’s willingness to find a part time job or even a job altogether
- UBI may encourage people to become lazy
- Employment rate may fall in accord with the decreased participation in work
- Since UBI applies indiscriminately, undesirable groups of people such as criminals may also receive welfare support
- The burden of the welfare system may be increased and thus lead to higher taxes
- The additional income may increase people’s demand for more goods and services, leading to an inflation that finally renders the cost of living too high to be met by UBI.