According to the statistics, every $1 billion spent by UN as unemployment benefits creates about 19,000 job places per annum. Finnish government has set a two-year trial to find out whether such kind of basic income experiment will encourage people to work more.
In November 2016, 2000 adults of 20-58 age groups who had been out of work were selected on the basis of arbitrary choice. During the following couple of years they had been paid monthly benefits of 560 Euros by The Social Insurance Institution of Finland (often called by its Finnish abbreviation, Kela). Recipients hadn’t had to seek and apply for jobs, albeit the subsidy had continued to be allocated even when citizens got employed.
Launched in January 2017, the experiment was noted all over the worlds, lots of foreign media provided deliberate coverage of the process since it had been speculated to be decisive in ending prolonged discrepancy around this topic.
Looking back to the history of the phenomenon, it is overt that huge public attention has always been drawn to the idea of unconditional subsidies.
The notion that every citizen must be given a guaranteed, regular stipend, emerged in 16th century. The aim was to reduce poverty and wealth gap.
Majority of famous people such as tech billionaire Mark Zuckerberg, the leftist politician Bernie Sanders, the economist Milton Friedman, the scientist Stephen Hawking and the civil rights activist Martin Luther King Jr demonstrated the endorsement of Universal Basic Income (UBI).
Canada has already tested several modules of UBI, Italy put them into practice, and Scotland and India are currently implementing particular schemes of benefits. The idea gets expeditiously popular in Silicon Valley after the innovation boom stirred fear about automation-induced joblessness.
When it comes to Finland itself, since 1980s, UBI has started to gain stream among Nordic left-of-centre political circles, mostly targeted to combat economic and social consequences of falling industrial unemployment. Yet the government had difficulties coming to consensus about the exact actions: Which module of UBI and what level of payment to choose, how to combine UBI with other security benefits.
Everyone contemplate UBI differently which leads to ambiguity and confusion. Dylan Matthews noted:
…these purposes are often confused and contradictory.
For some this is the way to diminish poverty rate, for others it helps to cope with joblessness. The primary aim of Finland- impacting people to accept more work, whether low-paying or temporary- failed to succeed. People didn’t get interested in entering workforce. Nevertheless, the positive results did occur: Recipients reported the boost of their wellbeing and decline in health and concentration problems. This is instrumental taking into consideration the fact that government spends immense funding on health service. Previous tests also derived the same output: In Dauphin, Canada once the basic income scheme was introduced in 1970s, a drop in doctor visits and fall of hospitalization occurred. Similarly Kenya, stable benefits contributed to people to become self-employed. One of the participants of the program stated:
It feels like the basic income gives you increased freedom and makes society more equal
Moreover, the theory that free money may cause less productivity– the biggest critique of UBI detractors- has been refuted.
However experts still disqualifies the Finnish scheme as it is limited to only the unemployed and the time lapse is not long enough to get solid conclusions.
But, anyway, meaningful results were indeed produced even in specific field.