A free lunch with robots – can a basic income stabilise the digital economy?

Ville-Veikko Pulkka
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Ville-Veikko Pulkka: University of Helsinki, Helsinki, Finland

Transfer: European Review of Labour and Research, 2017, vol. 23, issue 3, 295-311

Abstract: The discussion on the possible implications of the digital economy for labour continues unabated. An essential dimension of the discussion is the widely shared view that a basic income could guarantee sufficient purchasing power for unemployed, underemployed and precarious workers should technological unemployment and labour market insecurity increase. A budget-neutral basic income has serious limitations as an economic stabilisation grant, but if financing proposals are revised, these limitations can be tackled. Even though guaranteeing sufficient purchasing power for unemployed, underemployed and precarious workers does not necessarily require an unconditional universal benefit, it seems clear that traditional activation based on strict means-testing and obligations will not be a strategy flexible enough to guarantee sufficient consumer demand in fluctuating labour markets. An economically sustainable solution might be to reduce means-testing gradually and to study carefully the effects.

Keywords: Automation; basic income; digital economy; employment; negative income tax; precarious jobs; underemployment; technological unemployment (search for similar items in EconPapers)
Date: 2017
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Persistent link: https://EconPapers.repec.org/RePEc:sae:treure:v:23:y:2017:i:3:p:295-311

DOI: 10.1177/1024258917708704

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