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Experimenting with
Basic Income in Finland
Olli Kangas (olli.kangas@kela.fi)
Professor, Research Director
Kela, Social Ins...
Governmental mandate
• Prime Minister Juha Sipilä’s governmental program
includes a number of social experiments
• The bas...
Governmental mandate
• After an open bid, the preliminary study was
awarded to a Kela-led research consortium
consisting o...
Timetable and funding
• Timetable for the consortium:
• First hearing 5 December 2015
• Interim report 30 March 2016
• Fin...
Wide popular support for basic income in
Finland
• The wished-for medians are 1.3 times the level of
minimum pension
• Sup...
Models to be explored and developed
• Full basic income (BI)
• The level of BI is high enough to replace almost all
insura...
Methods
• Specification of models to be explored
• Juridical aspects dealing with social legislation
• Taxation
• Juridica...
Methods
• Planning the experimental setting
• Constitutional limitations: demand of equal treatment for all
− Voluntarines...
Experimental settings (example of an optimal
research setting, nothing selected yet)
• To get scientifically reliable resu...
Working group evaluates the models,
research setting and samples
• The task for the working group is to plan the
experimen...
More info
www.kela.fi/web/en/experimental-study-
on-a-universal-basic-income
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Experimental study on a universal basic income in Finland

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A working group of researchers from a range of organisations under the project leadership of Kela is exploring ways in which to carry out an experimental study focusing on the implementation of a universal basic income scheme. The project is part of the Finnish Government's analysis, assessment and research plan for 2015. This presentation collects information and data on the project.

More information: http://www.kela.fi/web/en/experimental-study-on-a-universal-basic-income

Published in: Government & Nonprofit
  • The Industrial Economy simply can't fund a 'Basic Income'. Money printing is often suggested as a means to fund any type of spending (including basic Income). Printing money and debauching the currency inevitably leads to society and economic failure not success. Although, you can get away with just printing money for long periods of time before failure. The solution is a new economic model that has the efficiency and productivity to be able to fund Basic Income that may be of interest. I wrote an article that highlights the opportunity to fund Basic Income using a new model. "Basic Income (Industrial Economy survival) vs. Minimum Life (Network Society contribution) … growth and purpose from contribution" at http://www.wisdom.to/minimum-life.html
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Experimental study on a universal basic income in Finland

  1. 1. Experimenting with Basic Income in Finland Olli Kangas (olli.kangas@kela.fi) Professor, Research Director Kela, Social Insurance Institution of Finland
  2. 2. Governmental mandate • Prime Minister Juha Sipilä’s governmental program includes a number of social experiments • The basic income pilot study is one of them • The aim is to reform existing social policy to better match with societal changes, abolish work disincentives and diminish bureaucracy 2
  3. 3. Governmental mandate • After an open bid, the preliminary study was awarded to a Kela-led research consortium consisting of: • The VATT Institute for Economic Research and the Swedish School of Social Science, University of Helsinki • Universities of Turku and Tampere • Think tank Tänk • The Finnish Innovation Fund (SITRA) • Federation of Finnish Enterprises • Experts representing municipalities and constitutional, social and tax law 3
  4. 4. Timetable and funding • Timetable for the consortium: • First hearing 5 December 2015 • Interim report 30 March 2016 • Final report 15 November 2016 • The experiment will start in the beginning of 2017 and will last for 2 years • Results will be evaluated in 2019 • Funding comes from the Government • €20 million for two years 4
  5. 5. Wide popular support for basic income in Finland • The wished-for medians are 1.3 times the level of minimum pension • Support among voters of all political parties: • Left Alliance 86%, Social Democrats 69%, Greens 75%, Centre 62%, Finns Party 69%, Christian Democrats 56%, Swedish People’s Party 83%, National Coalition Party 54% 5 Support Wished-for level € (median) 2002 63% € 622 2015 69% € 1,000
  6. 6. Models to be explored and developed • Full basic income (BI) • The level of BI is high enough to replace almost all insurance-based benefits • Monthly sum must be rather high – realistic? • Partial basic income • Replaces all ‘basic’ benefits but almost all insurance-based benefits left intact • Minimum level should not be lower than the current minimum level of basic benefits (net approx. €550 a month) • Negative income tax • Income transfers via taxation • Other models • Perhaps low BI plus ‘participation’ income6
  7. 7. Methods • Specification of models to be explored • Juridical aspects dealing with social legislation • Taxation • Juridical aspects dealing with the constitution (equal treatment of residents and the right to social care and income protection) • Evaluating the costs with microsimulations • Distribution of benefits and costs • Which options appear to be feasible/unfeasible 7
  8. 8. Methods • Planning the experimental setting • Constitutional limitations: demand of equal treatment for all − Voluntariness → selection bias − Two stage sampling among volunteers: Treatment and control groups − Obligatory: − Local experiments to capture externalities 8
  9. 9. Experimental settings (example of an optimal research setting, nothing selected yet) • To get scientifically reliable results and evidence for policy making the experimental setting must: • Include a sufficient number of households (rather than individuals) • Be nationally representative − A national level randomization, for instance 10,000 cases • Include a county level experiment − A random sample of, for instance, 10% of a county’s population • Include local experiments to capture networking, institutional and interaction effects and various externalities − For example, local municipalities with 10%, 30% random sampling and perhaps 2 municipalities with 100% samples 9
  10. 10. Working group evaluates the models, research setting and samples • The task for the working group is to plan the experiment • After the first report (due 30 March, 2016) the Government will decide which models should be further developed • Later in 2016 the Government will decide which model/s will be experimented with and what the target population and experimental setting will be • The expert group will prepare suggestions for the decision 10
  11. 11. More info www.kela.fi/web/en/experimental-study- on-a-universal-basic-income 11

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