Universal basic income vs jobs guarantees: which one will make us happier?

Cory Doctorow, Boing Bong

Two competing (or, possibly, complementary?) proposals for resolving income inequality and the hole that four decades of demand-side Reaganomics has dug us into are Universal Basic Income and a federal jobs guarantee (the former being a kind of “venture capital for everyone” that provides enough money to live without having to work for an employer; and the latter being a guarantee of a good, meaningful job of social value in sectors like infrastructure, education and caring professions).

There’s not much data about the performance of either proposal, and there’s a lot of potentially contradictory indirect inferences we can make about the pluses and minuses of each. For example, David Graeber’s Bullshit Jobs features anthropoligical accounts of the misery of working in make-work jobs that demand nothing of you, contrasted with the pleasures of goofing off without having to pretend to be working (Marx predicted that goofing off would be a major occupation in a postcapitalist utopia); while other work shows that being unemployed is also really hard on people, whose fall in status and self-worth makes not working a hard job. Of course, those people are living in the world today, not the universal income (or jobs guarantee) (or both) world of tomorrow — who knows what that will do?

Tim Harford rounds up a lot of the research on both ideas and suggests that you draw your own conclusion.

In the words of Warwick university economist Andrew Oswald: “There is overwhelming statistical evidence that involuntary unemployment produces extreme unhappiness.” What’s more, adds Prof Oswald, most of this unhappiness seems to be because of a loss of prestige, identity or self-worth. Money is only a small part of it. This suggests that the advocates of a jobs guarantee may be on to something.

In this context, it’s worth noting two recent studies of lottery winners in the Netherlands and Sweden, both of which find that big winners tend to scale back their hours rather than quitting their jobs. We seem to find something in our jobs worth holding on to.

Yet many of the trappings of work frustrate us. Researchers led by Daniel Kahneman and Alan Krueger asked people to reflect on the emotions they felt as they recalled episodes in the previous day. The most negative episodes were the evening commute, the morning commute, and work itself.

Things were better if people got to chat to colleagues while working, but (unsurprisingly) they were worse for low status jobs, or jobs for which people felt overqualified. None of which suggests that people will enjoy working on a guaranteed-job scheme.

Psychologists have found that we like and benefit from feeling in control. That is a mark in favour of a universal basic income: being unconditional, it is likely to enhance our feelings of control. The money would be ours, by right, to do with as we wish. A job guarantee might work the other way: it makes money conditional on punching the clock.

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