IDEAS home Printed from https://ideas.repec.org/a/sae/ecolab/v31y2020i4p502-523.html
   My bibliography  Save this article

Between universalism and targeting: Exploring policy pathways for an Australian Basic Income

Author

Listed:
  • Ben Spies-Butcher

    (Macquarie University, Australia)

  • Ben Phillips

    (The Australian National University, Australia)

  • Troy Henderson

    (The University of Sydney, Australia)

Abstract

Despite growing interest in proposals for a universal basic income, little advance has been made in implementation. Here we explore policy options for an Australian Basic Income. Our analysis responds to concerns that Basic Income is both too expensive and too radical a departure from existing welfare state structures to be a feasible policy option. Drawing on policy and Basic Income scholarship we identify changes to Australia’s current means-tested benefits structures that move substantially towards Basic Income while remaining consistent with historic policy norms, which we call ‘affluence testing’. Using microsimulation we explore fiscal and distributional trade-offs associated with the implementation of an affluence-tested Basic Income. Our results suggest Basic Income has the potential to significantly reduce inequality and poverty while also requiring taxes to rise substantially. Placing these trade-offs in international context we find the policy would reduce inequality to levels similar to Nordic welfare states while increasing overall taxation to approximately the OECD average. JEL Codes: I3, H2, H5

Suggested Citation

  • Ben Spies-Butcher & Ben Phillips & Troy Henderson, 2020. "Between universalism and targeting: Exploring policy pathways for an Australian Basic Income," The Economic and Labour Relations Review, , vol. 31(4), pages 502-523, December.
  • Handle: RePEc:sae:ecolab:v:31:y:2020:i:4:p:502-523
    DOI: 10.1177/1035304620964272
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/1035304620964272
    Download Restriction: no

    File URL: https://libkey.io/10.1177/1035304620964272?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Wim Van Lancker & Natascha Van Mechelen, 2014. "Universalism under siege? Exploring the association between targeting, child benefits and child poverty across 26 countries," Working Papers 1401, Herman Deleeck Centre for Social Policy, University of Antwerp.
    2. Hayley Fisher & Anna Zhu, 2019. "The Effect of Changing Financial Incentives on Repartnering," Economic Journal, Royal Economic Society, vol. 129(623), pages 2833-2866.
    3. David Ingles, 2000. "Rationalising the Interaction of Tax and social Security: Part II: Fundamental Reform Options," CEPR Discussion Papers 424, Centre for Economic Policy Research, Research School of Economics, Australian National University.
    4. Mcknight, Abigail, 2015. "A fresh look at an old question: is pro-poor targeting of cash transfers more effective than universal systems at reducing inequality and poverty?," LSE Research Online Documents on Economics 103977, London School of Economics and Political Science, LSE Library.
    5. Harvey Philip L., 2006. "The Relative Cost of a Universal Basic Income and a Negative Income Tax," Basic Income Studies, De Gruyter, vol. 1(2), pages 1-24, December.
    6. repec:oup:econjl:v:129:y:2019:i:10:p:2833-2866. is not listed on IDEAS
    7. Abigail McKnight, 2015. "A fresh look at an old question: is pro-poor targeting of cash transfers more effective than universal systems at reducing inequality and poverty?," ImPRovE Working Papers 15/14, Herman Deleeck Centre for Social Policy, University of Antwerp.
    8. Abigail McKnight, 2015. "A fresh look at an old question: is pro-poor targeting of cash transfers more effective than universal systems at reducing inequality and poverty?," CASE Papers /191, Centre for Analysis of Social Exclusion, LSE.
    9. Marx, Ive & Salanauskaite, Lina & Verbist, Gerlinde, 2013. "The Paradox of Redistribution Revisited: And That It May Rest in Peace?," IZA Discussion Papers 7414, Institute of Labor Economics (IZA).
    10. Hilary W. Hoynes & Jesse Rothstein, 2019. "Universal Basic Income in the US and Advanced Countries," NBER Working Papers 25538, National Bureau of Economic Research, Inc.
    11. J. E. Meade, 1993. "Liberty, Equality and Efficiency," Palgrave Macmillan Books, Palgrave Macmillan, number 978-1-349-13084-9, September.
    12. Jurgen De Wispelaere & Antti Halmetoja & Ville-Veikko Pulkka, 2018. "The Rise (and Fall) of the Basic Income Experiment in Finland," CESifo Forum, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 19(03), pages 15-19, October.
    13. Joakim Palme & Walter Korpi, 1998. "The Paradox of Redistribution and Strategies of Equality: Welfare State Institutions, Inequality and Poverty in the Western Countries," LIS Working papers 174, LIS Cross-National Data Center in Luxembourg.
    14. Ben Spies-Butcher & Troy Henderson, 2019. "Stepping Stones to an Australian Basic Income," Exploring the Basic Income Guarantee, in: Elise Klein & Jennifer Mays & Tim Dunlop (ed.), Implementing a Basic Income in Australia, chapter 9, pages 163-178, Palgrave Macmillan.
    15. Esping-Andersen, Gosta, 1999. "Social Foundations of Postindustrial Economies," OUP Catalogue, Oxford University Press, number 9780198742005, April.
    16. Brady, David & Bostic, Amie, 2015. "Paradoxes of Social Policy: Welfare Transfers, Relative Poverty, and Redistribution Preferences," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, pages 268-298.
    17. Jurgen De Wispelaere & José Antonio Noguera, 2012. "On the Political Feasibility of Universal Basic Income: An Analytic Framework," Exploring the Basic Income Guarantee, in: Richard K. Caputo (ed.), Basic Income Guarantee and Politics, chapter 0, pages 17-38, Palgrave Macmillan.
    18. Abigail McKnight, 2015. "A Fresh Look at an Old Question: Is Pro-Poor Targeting of Cash Transfers More Effective Than Universal Systems at Reducing Inequality and Poverty?," LIS Working papers 640, LIS Cross-National Data Center in Luxembourg.
    19. Ive Marx & Lina Salanauskaite & Gerlinde Verbist, 2013. "The paradox of redistribution revisited: and that it may rest in peace?," LIS Working papers 593, LIS Cross-National Data Center in Luxembourg.
    20. Ugo Gentilini & Margaret Grosh & Jamele Rigolini & Ruslan Yemtsov, 2020. "Exploring Universal Basic Income," World Bank Publications - Books, The World Bank Group, number 32677, December.
    21. Jim Stanford, 2019. "A turning point for labour market policy in Australia," The Economic and Labour Relations Review, , vol. 30(2), pages 177-199, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Frank Stilwell, 2021. "From green jobs to Green New Deal: What are the questions?," The Economic and Labour Relations Review, , vol. 32(2), pages 155-169, June.
    2. Suzuki, Tomoya, 2021. "Basic income, wealth inequality and welfare: A proposed case in New Zealand," Economic Analysis and Policy, Elsevier, vol. 72(C), pages 118-128.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Xabier Garcia-Fuente, 2021. "The Paradox of Redistribution in Time. Social Spending in 53 Countries, 1967-2018," LIS Working papers 815, LIS Cross-National Data Center in Luxembourg.
    2. Munoz de Bustillo Llorente Rafael & FERNANDEZ MACIAS Enrique & GONZALEZ VAZQUEZ Ignacio, 2020. "Universality in Social Protection: An Inquiry about its Meaning and Measurement," JRC Research Reports JRC122953, Joint Research Centre (Seville site).
    3. Elena Bárcena-Martín & M. Carmen Blanco-Arana & Salvador Pérez-Moreno, 2017. "Dynamics of child poverty in the European countries," Working Papers 437, ECINEQ, Society for the Study of Economic Inequality.
    4. Mr. David Coady & Devin D'Angelo & Brooks Evans, 2019. "Fiscal Redistribution and Social Welfare," IMF Working Papers 2019/051, International Monetary Fund.
    5. Elvire Guillaud & Matthew Olckers & Michaël Zemmour, 2020. "Four Levers of Redistribution: The Impact of Tax and Transfer Systems on Inequality Reduction," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 66(2), pages 444-466, June.
    6. David Brady & Amie Bostic, 2014. "Paradoxes of social policy: Welfare transfers, relative poverty and redistribution preferences," LIS Working papers 624, LIS Cross-National Data Center in Luxembourg.
    7. Louis Chauvel & Eyal Bar-Haim, 2016. "Varieties of Capitalism (VoC) and Varieties of Distributions (VoD): How Welfare Regimes Affect the Pre- and Post-Transfer Shapes of Inequalities?," LIS Working papers 677, LIS Cross-National Data Center in Luxembourg.
    8. Orsetta Causa & Mikkel Hermansen, 2017. "Income redistribution through taxes and transfers across OECD countries," OECD Economics Department Working Papers 1453, OECD Publishing.
    9. Pim Verbunt & Anne-Catherine Guio, 2019. "Explaining Differences Within and Between Countries in the Risk of Income Poverty and Severe Material Deprivation: Comparing Single and Multilevel Analyses," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 144(2), pages 827-868, July.
    10. Bodenstein, Thilo & Kemmerling, Achim, 2015. "A Paradox of Redistribution in International Aid? The Determinants of Poverty-Oriented Development Assistance," World Development, Elsevier, vol. 76(C), pages 359-369.
    11. Ive Marx & Brian Nolan & Javier Olivera, 2014. "The Welfare State and Anti-Poverty Policy in Rich Countries," Working Papers 1403, Herman Deleeck Centre for Social Policy, University of Antwerp.
    12. Wim Van Lancker & Natascha Van Mechelen, 2014. "Universalism under siege? Exploring the association between targeting, child benefits and child poverty across 26 countries," Working Papers 1401, Herman Deleeck Centre for Social Policy, University of Antwerp.
    13. Lin Yang, 2018. "The net effect of housing-related costs and advantages on the relationship between inequality and poverty," CASE Papers /211, Centre for Analysis of Social Exclusion, LSE.
    14. Orsetta Causa & Mikkel Hermansen, 2018. "Income Redistribution Through Taxes and Transfers across OECD Countries," LIS Working papers 729, LIS Cross-National Data Center in Luxembourg.
    15. Victor Amoureux & Elvire Guillaud & Michaël Zemmour, 2019. "It Takes Two to Tango Income and Payroll Taxes in Progressive Tax Systems," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-02735278, HAL.
    16. Chrysa Leventi & Olga Rastrigina & Holly Sutherland, 2016. "The importance of income-tested benefits in good times and bad: lessons from EU countries," ImPRovE Working Papers 16/01, Herman Deleeck Centre for Social Policy, University of Antwerp.
    17. Katherine Baird, 2015. "Who Did Safety Nets Catch During the Great Recession and How? A Comparison of Eleven OECD Countries," LIS Working papers 620, LIS Cross-National Data Center in Luxembourg.
    18. Parolin, Zachary & Gornick, Janet C., 2021. "Pathways toward Inclusive Income Growth: A Comparative Decomposition of National Growth Profiles," SocArXiv rsxz6, Center for Open Science.
    19. Lin Yang, 2018. "The relationship between poverty and inequality: Resource constraint mechanisms," CASE Papers /212, Centre for Analysis of Social Exclusion, LSE.
    20. Maggie Ka-Wai Lau & Kee-Lee Chou, 2019. "Targeting, Universalism and Child Poverty in Hong Kong," Child Indicators Research, Springer;The International Society of Child Indicators (ISCI), vol. 12(1), pages 255-275, February.

    More about this item

    Keywords

    Basic income; fiscal policy; income distribution; social policy; taxation/taxation system/taxation policy; welfare state;
    All these keywords.

    JEL classification:

    • I3 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty
    • H2 - Public Economics - - Taxation, Subsidies, and Revenue
    • H5 - Public Economics - - National Government Expenditures and Related Policies

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:ecolab:v:31:y:2020:i:4:p:502-523. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: . General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.