A quantitative evaluation of universal basic income

Juan Carlos Conesa and Bo Li (2023) A quantitative evaluation of universal basic income. Journal of Public Economics, 223, [104881]. (doi:10.1016/j.jpubeco.2023.104881).

Record type: Article

Abstract

We provide a quantitative evaluation of the impact of Universal Basic Income (UBI) as an alternative to the existing system of means-tested transfers. We explore varying levels of UBI generosity, paired with different strategies to finance it. All the reforms we consider result in welfare losses for a huge majority of initial households. Moreover, these losses are increasing in UBI generosity. A reform financed with consumption taxes implies lower efficiency losses than reforms financed with income taxes, but fewer individuals benefit from it.

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More information

Accepted/In Press date: 4 May 2023

e-pub ahead of print date: 15 May 2023

Published date: July 2023

Additional Information: Funding Information: This project is supported by the High-performance Computing Platform of Peking University and School of Economics (Peking University), and by the National Natural Science Foundation of China (Grant No. 72103119 and Grant No. 72203005). Publisher Copyright: © 2023 Elsevier B.V.

Keywords: Consumption floor, Consumption tax, Heterogeneous agents, Incomplete market, Learning by doing, Transitional dynamics, Universal basic income