Editor's Note:
This memo was originally prepared for the Aspen Economic Strategy Group.
Abstract
Melissa S. Kearney
Nonresident Senior Fellow - Economic Studies, Center on Children and Families
Magne Mogstad
Gary S. Becker Professor in Economics and the College - Kenneth C. Griffin Department of Economics, University of Chicago
We briefly review the main motivations behind recent calls for a Universal Basic Income (UBI) in the United States and the main features of some current UBI proposals. We then argue that a UBI would be extremely expensive and yet do very little to reduce inequality or advance opportunity and social mobility. We argue that instead of a UBI, the federal government should pursue a pro-work strategy of income support, paying wage subsidies to low-wage workers along with targeted transfer benefits consisting of both cash and near-cash types of support paid to the most needy individuals and households.
