Monday, February 13, 2017

Thomas Piketty — Is our basic income really universal?

After our call « For a credible and bold basic income » launched by a group of ten researchers (Antoine Bozio, Thomas Breda, Julia Cagé, Lucas Chancel, Elise Huillery, Camille Landais, Dominique Méda, Emmanuel Saez, Tancrède Voituriez), we received considerable support and also, of course, questions and requests for clarification. The first question was: Given that the system of a basic income which we propose does not defend the idea of an identical monthly allowance paid to each individual, is it really universal? The question is legitimate and I would like to reply here as clearly as possible....
Thomas Piketty's Blog
Is our basic income really universal?
Thomas Piketty | Professor at EHESS and at the Paris School of Economics
ht Mark Thoma at Economist's View


Dan Lynch said...

Piketty's proposal is complicated, which by itself is a strike against it. But if I understand him correctly, he is advocating a means-tested BIG that is higher than the minimum wage. Hence minimum wage employees would receive a wage supplement to bring their total income up to the BIG level.

We already have a similar kind of "basic income" in the U.S., it's called "Earned Income Credit" and "Food Stamps." Like England's Speenhamland system, they're defacto subsidies to employers because they allow the employer to pay less than a living wage.

I cannot take Piketty's proposal seriously because he does not address the Speenhamland effect.

I believe that a BIG can be made to work, but the devil is in the details. My BIG proposal calls for a weekly BIG set at 25% less than the minimum wage. Thus anyone who works 40 hours at minimum wage would not qualify for the BIG, and there would be no "Speenhamland effect" for full time workers (though employers might try to get around this by hiring only part time workers, regulations would be required to address that).

If the concern is that the minimum wage is not a living wage, the solution should be obvious -- RAISE THE MINIMUM WAGE! That, and maintaining full employment are the surest ways to help the working class. Niceties like a BIG or a JG can be used to help those who fall through the cracks.

Neil Wilson said...

There seems to be a push at the moment to rebrand a combined unemployment benefit and tax credit system as 'basic income'.

The Finnish system is the same.

They are all subsidises to private employers essentially begging them to provide low level gig jobs so politicians can massage the unemployment figures.