Basic Income and the Dynamics of Employment and Human Capital in a Non-Urban Disadvantaged Setting

Jorge Luis Garcia (), Patrick Warren and L. Reed Watson

No 33891, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Why and when could basic income inhibit employment? We randomize 200 dollars of basic income per month for two years within a non-urban disadvantaged sample tracked using high-frequency administrative data. The amount provided is 21% of average all-source income. In the short term (0.5 years after baseline), relative to the control group, treatment-group employment decreases by 58%, average all-source income remains constant, and health-investment rates increase. In the longer term (1.25 years after baseline), employment and health-investment rates revert to their control-group counterparts. Treatment participants receive basic income, take time off work, address health needs, and, subsequently, reintegrate into employment.

JEL-codes: H20 I12 J01 J08 (search for similar items in EconPapers)
Date: 2025-06
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