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Basic Income and the Dynamics of Employment and Human Capital in a Non-Urban Disadvantaged Setting

Author

Listed:
  • Jorge Luis García
  • Patrick L. Warren
  • L. Reed Watson

Abstract

Why and when could basic income inhibit employment? We randomize 200 dollars of basic income per month for two years within a non-urban disadvantaged sample tracked using high-frequency administrative data. The amount provided is 21% of average all-source income. In the short term (0.5 years after baseline), relative to the control group, treatment-group employment decreases by 58%, average all-source income remains constant, and health-investment rates increase. In the longer term (1.25 years after baseline), employment and health-investment rates revert to their control-group counterparts. Treatment participants receive basic income, take time off work, address health needs, and, subsequently, reintegrate into employment.

Suggested Citation

  • Jorge Luis García & Patrick L. Warren & L. Reed Watson, 2025. "Basic Income and the Dynamics of Employment and Human Capital in a Non-Urban Disadvantaged Setting," NBER Working Papers 33891, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:33891
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    More about this item

    JEL classification:

    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General
    • J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies

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