{"id":185955,"date":"2022-05-23T21:01:14","date_gmt":"2022-05-23T15:31:14","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=185955"},"modified":"2022-05-23T21:01:14","modified_gmt":"2022-05-23T15:31:14","slug":"time-for-us-to-work-out-a-universal-basic-income","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/time-for-us-to-work-out-a-universal-basic-income\/","title":{"rendered":"Time for us to work out a universal basic income"},"content":{"rendered":"\n

Context<\/strong>: India\u2019s debate on the need and feasibility of a universal basic income<\/strong><\/a><\/span> (UBI) as an elementary safety net for all our citizens was revived again after the Economic Advisory Council to the Prime Minister released a report on inequality.<\/a><\/strong><\/span><\/p>\n

Regardless of divisions in opinion over the poverty levels in the country, inequality demands a bold policy response.<\/p>\n

What are the two key suggestions made in the report?<\/h5>\n

Urban employment guarantee scheme<\/strong>: It advocates fallback job options for urban Indians along the lines of the Mahatma Gandhi National Rural Employment Guarantee Scheme, which assures rural residents 100 days of pay-for-work each year for the asking.<\/p>\n

Universal Basic Income (UBI)<\/strong>: The report also supports a UBI, an idea that is still seen as somewhat radical in policy circles.<\/p>\n\n\n\n
Must Read<\/strong>: Issues with the idea of an urban employment guarantee scheme<\/span><\/a><\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n
How has the pandemic affected the economy?<\/strong><\/h5>\n

Large numbers of asset-poor suffered a severe impact on their income<\/strong>.<\/p>\n

Modest earners had been hit hard by a formalization drive a few years earlier, while an overall slowdown of India\u2019s economy worsened a job scarcity<\/strong> that is yet to ease.<\/p>\n

To be sure, free food rations and job handouts played vital roles in offering the poor relief. But the distress has spanned multiple socio-economic classes. Credible reports suggest that even middle-class homes were pushed into poverty<\/strong>.<\/p>\n

What are the factors involved in the implementation of UBI in India?<\/h5>\n

For welfare efficiency, we should institute leak-proof direct transfers<\/strong> covering all adults.<\/p>\n

Expensive scheme<\/strong>: No doubt, a UBI scheme would be expensive. For about a billion beneficiaries, it would cost an annual \u20b9<\/span>12 trillion just for each adult to get a monthly \u20b9<\/span>1,000.<\/p>\n

–<\/strong> But what looks like premature welfarism<\/strong> today could well be affordable tomorrow as central coffers expand, especially if we cut\u00a0 inefficient fiscal expenses and urge the non-needy to opt out of UBI net.<\/p>\n

An eligibility cut-off<\/strong> is sure to be proposed, but a denial criterion<\/strong> could defeat its inclusivity and pose barriers to upward mobility at that level.<\/p>\n

As for the worry of workers not working hard<\/strong>, an assured income would act as a belly-filler at best, so that should not deter an Indian UBI plan.<\/p>\n

–<\/strong> In general, a decrease in an economy\u2019s labour-supply caused by cash giveaways have been debunked by studies. In the US, a 2018 working paper by Ioana Marinescu on the behavioural effects of cash transfers found just a 1% drop in labour supply induced by a 10% income boost.<\/p>\n

–<\/strong> Earlier research by Abhijit Banerjee and others, outlined in \u2018Debunking the Stereotype of the Lazy Welfare Recipient\u2019, had similar findings for emerging economies.<\/p>\n

Way forward<\/h5>\n

It\u2019s time for a plan to share public funds with all citizens in need.<\/p>\n

Source<\/strong>: This post is based on the article \u201cTime for us to work out a universal basic income<\/strong>\u201d published in Livemint<\/strong> on 23rd May 22<\/strong>.<\/p>\n","protected":false},"excerpt":{"rendered":"

Context: India\u2019s debate on the need and feasibility of a universal basic income (UBI) as an elementary safety net for all our citizens was revived again after the Economic Advisory Council to the Prime Minister released a report on inequality. Regardless of divisions in opinion over the poverty levels in the country, inequality demands a… Continue reading Time for us to work out a universal basic income<\/span><\/a><\/p>\n","protected":false},"author":10328,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1230,9],"tags":[216,10501],"class_list":["post-185955","post","type-post","status-publish","format-standard","hentry","category-9-pm-daily-articles","category-public","tag-gs-paper-3","tag-live-mint","entry"],"jetpack_featured_media_url":"","views":{"total":0,"cached_at":"","cached_date":1704917501},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/185955","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10328"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=185955"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/185955\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=185955"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=185955"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=185955"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}