Universal Basic Income is Not an Innovation Policy

Robert Seamans
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Entrepreneurship and innovation are important ingredients for our economy.
By Robert Seamans
The idea behind Universal Basic Income (UBI) is to replace existing safety net programs with a single, unconditional cash transfer. In contrast, existing safety net programs typically require an application to establish eligibility, such as registering for work, taking part in training programs, or meeting income thresholds. Despite some potential drawbacks, UBI has become a popular policy proposal, especially as a potential solution to mass joblessness arising from automation and other rapid changes in the workplace (though whether automation will lead to mass joblessness is very much up for debate).

During his recent commencement address at Harvard, Facebook’s Mark Zuckerberg expressed his support for UBI and stated that we should “make sure that everyone has a cushion to try new ideas.” While Zuckerberg’s comments are well intentioned, and while UBI may have many other benefits described below, UBI is not a good policy for stimulating innovation or entrepreneurship. If we are serious about stimulating innovation and entrepreneurship, there are other policies with a record of success that we should consider first.

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Robert Seamans is an Associate Professor of Management and Organizations.