One thousand people in two U.S. states will be given $1,000 a month in basic income for three years.

Gina Chon, Zawya

Facebook's founder and CEO Mark Zuckerberg speaks at the Viva Tech start-up and technology summit in Paris, France, May 24, 2018. REUTERS/Charles Platiau - RC16176F1100

Article orginally published June 10, 2019.

SAN FRANCISCO – Silicon Valley has a role to play in uncovering the basics of basic income. Seed-capital guru Y Combinator is joining the ranks of those studying the pros and cons of giving people a guaranteed monthly stipend. This private-sector initiative is bigger, longer and less restrictive than the largely government-backed pilots that have come before.

Growing inequality and worries about workers losing their jobs to technology have made universal basic income a popular topic. Facebook Chief Executive Mark Zuckerberg and Tesla boss Elon Musk have spoken favorably of the concept. Businessman Andrew Yang has made it the cornerstone of his long-shot U.S. presidential bid.

But there’s not much evidence of how it would work in practice. Stockton’s Mayor Michael Tubbs kicked off an experiment in February. But it’s small, giving just 100 residents $500 a month for 18 months. The press is reporting on some of the participants, too, which could influence their decisions and skew the results.

A broader, two-year government study in Finland that concluded at the end of 2018 focused only on the jobless. Preliminary results released in February show the 560 euros in monthly income given to 2,000 people made no overall difference to the group’s unemployment rate. But recipients reported less stress.

That’s what makes the study led by Y Combinator’s research arm compelling. One thousand people in two states will be given $1,000 a month for three years. Participants can’t earn more than the average national median income, which is $37,000 for an individual.

Recipients will remain anonymous and reflect gender and ethnic diversity. The topics that will be studied include physical and financial health, impact on children, and the effect on crime rates. The chosen states will be announced later this year, but the exact locations will not be disclosed.

The cost of a UBI study can be prohibitive for the public purse. The $60 million for the Y Combinator project is coming from private donors, including the firm’s adviser and former chairman, Sam Altman. Facebook co-founder Andrew McCollum is among those stumping up the $3 million budgeted for Stockton’s plan.

Their involvement in a social study many might see as best left to government will raise eyebrows. But Y Combinator has teamed up with Stanford University and others to ensure the work is rigorous and neutral. That and its overall higher standards should yield more useful results for policymakers.


– The research division of startup incubator Y Combinator is in the process of choosing individuals in two states to participate in a study on universal basic income. A group of 1,000 people will receive $1,000 a month for three years to see how such a set payment changes their behavior and financial health. They will be compared to a group of 2,000 people who are to receive $50 a month.

– There are no work requirements as part of the study. Only people whose total annual household income in the year before enrollment did not exceed the national median, with a range of $37,000 for an individual to $76,000 for a four-person household, are eligible to participate. The states chosen for the study will be announced later in 2019.

(Editing by Antony Currie and Amanda Gomez)

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