Finland Experiments With Basic Income for the Unemployed

The new Finnish trial is meant to test how people behave when they receive money from the government each month with no strings attached, The Guardian reports. Two thousand unemployed Finnish citizens will receive about $580 (€560) per month under the plan, which began January 1. The money will be deducted from whatever other government benefits they receive.

The idea of universal income has been tested in several regions of the world, including Ontario, Canada; Utrecht, the Netherlands; and Otjivero, Namibia. The Silicon Valley start-up incubator Y Combinator is currently funding a small study in Oakland, California. However, basic income programs are not embraced by all lawmakers or citizens. This summer, a large majority of Swiss voters voted against a proposal to give every citizen basic income regardless of their work status or salary.

The idea behind basic income is that when people get a little extra money each month, they have the freedom to pursue better jobs, instead of just saying "yes" to the first available job, and can better cope with the automation of industry putting people out of work. Critics, however, believe that it could tank the economy, making people lazy by giving them the option not to work.

The Finnish program aims to reduce the number of people who stay out of the workforce or refuse short-term and low-paying jobs for fear of losing the government benefits they depend on. Since the trial is limited to 2000 randomly selected people, researchers will be able to compare the effect of receiving basic income to those people who depend on unemployment benefits but don’t receive the basic income paycheck. The program is set to last for two years.