You're probably thinking of bench science labs with their microscopes and burners. That's not what our work looks like. If instead you think of a lab as a place where people work together as a team to solve scientific problems with a singular focus then you're imagining what we're up to here.
There are existing studies of U.S. and Canadian negative income tax experiments, the Alaska Permanent Fund Dividend (PFD), and the Eastern Band of Cherokees (EBC) casino dividend program, among others.
The overall effects of cash transfers depend on the program design. There is little evidence of its impact on labor force participation, while significant increases have shown in quality-of-life outcomes like mental and physical health, education, parenting, and criminal activity.
Existing studies suggest the average worker will not drop out of the labor market when receiving a cash transfer. Some reduce their hours worked.
Some studies suggest school attendance and educational attainment are boosted by cash transfer programs, especially for younger and poorer children.
Eastern Cherokee children whose families received casino payments stayed in school longer.
There is evidence that income tax experiments lead to improvements in nutrition, perhaps because of increased spending on fresh, “non-durable” foods.
In Canada, cash transfer recipients experienced reductions in hospitalizations, especially for mental health, accidents, and injuries.
Native American recipients of casino dividends show an improvement in mental health. In adulthood, children who had received benefits were less likely to experience alcohol or cannabis dependence.
In contexts with universal healthcare, such as Sweden, there appear to be no effects on health outcomes.
Evidence from Gary, Indiana, suggests fertility rates decrease and birth weights increase following a cash transfer.
Similar results from Alaska’s Permanent Dividend Fund suggest modest but positive effects on birth weight.
Children report more positive interactions with parents among casino dividend recipients.
Some analyses of Income Maintenance Experiments (IME) from the 1970s suggest an increase in divorces, though these results have been strongly disputed. Casino dividend programs showed no effect on household status or marital status.
Analysis of the Canadian Manitoba Basic Annual Income Experiment, or “Mincome,” suggested a reduction in inter-partner violence.
Self-reported criminal activity decreased among recipients of the Eastern Band of Cherokee casino dividend.
Canada’s Manitoba Basic Annual Income Experiment, or “Mincome,” showed a reduction in both violent crime and total crime.
We still know too little about cash transfers. One solution is to build an evidence base by studying the Alaska Permanent Fund Dividend program that has been in place since 1982. With this case, we have 35 years' worth of data to investigate and cash transfer amounts that, on average, exceed the value of Food Stamps to a family of four. What’s more, because the amount of the transfer varies year-to-year and is determined at the state level, it mimics the random assignment in a randomized control trial. It is exogenous to the individual Alaskan’s behavior and the local economy. The Alaskan population is large and diverse, and the state has high-quality data like vital registries, tax data, and crime registries.
The Alaska Permanent Fund Dividend serves as a natural experiment.
Lessons from this natural experiment complement the smaller, randomized control trials of cash transfers, such as the Stockton Economic Empowerment Demonstration and the Y Combinator research basic income experiment, which are currently underway or planned.
Learn more about our current research.
Universal Basic Income (UBI) is a policy whereby the government gives an unconditional, periodic payment to eligible residents. It is sometimes referred to as “guaranteed minimum income” or “income guarantee.” Typically, UBI proposals and policy ideas include consistent monthly payments – enough money for an individual or family to live on for an entire year. The universal nature of UBI means they are unconditional, and recipients do not need to qualify under an income threshold.
Is Alaska’s Permanent Fund Dividend a Universal Basic Income?
No, there are important differences between a PFD and a UBI.
Alaska’s Permanent Fund Dividend is not a “basic income” in the sense that it is generally not enough money for an individual or family to live on for an entire year. The amount of the dividend is paid out annually rather than monthly, and the size varies from year to year. It is also not funded by taxes but rather from the returns on the state’s invested oil revenues. The general consensus in Alaska is that this policy is not a UBI, and some people instead view it as an ownership share of their state’s natural resources.
Alaska’s PFD is one of the only long-standing examples of a universal cash transfer. Studying the program allows us to better understand how consistent and non-means-tested cash impacts individuals' and families' lives. In particular, the year-to-year variation provides the opportunity for us to analyze how outcomes differ based on the magnitude of the dividend. Considering it is not means tested, we can identify how the effects of the cash vary by income group and other demographics.
Learn more about current research at the Cash Transfer Lab..