Money can buy happiness (temporarily): Results of Sam Altman's Basic Income study
Total individual savings for recipients increased by nearly 25%.
What’s your take on UBI, i.e. Universal Basic Income, i.e. a social welfare proposal in which all citizens of a given population regularly receive a minimum income in the form of an unconditional transfer payment.
Given the expected AGI moment, tech billionaires are exploring UBI and OpenAI’s Sam Altman went ahead investing $14mn in one such project.
The results of Sam Altman's groundbreaking basic-income study have been released, revealing significant insights into the impact of guaranteed income on low-income individuals.
This study, one of the largest of its kind in the U.S., provided participants with $1,000 a month for three years, without any conditions. Here are the key points from the findings:
A quick overview of the study
Participants: 3,000 low-income individuals from Texas and Illinois, all earning below $28,000 annually.
Structure: One-third received $1,000 monthly, while a control group of 2,000 received $50 a month. No participants lost existing benefits.
Funding: Sam Altman, CEO of OpenAI, raised $60 million for the study, including $14 million of his own funds.
Key Findings
Financial Stability: Recipients primarily used the extra money for essential needs like rent, food, and transportation, improving their financial stability.
Workforce Engagement: Contrary to concerns, participants didn't drop out of the workforce entirely. Instead, they worked fewer hours, potentially seeking more fulfilling or higher-paying jobs.
Improved Well-being: The initial positive impact on mental health and stress levels diminished over time, highlighting the complexity of addressing long-term challenges.
Increased Agency: Participants felt empowered to make life-changing decisions, from moving to better neighborhoods to exploring entrepreneurial ventures.
Spending Patterns
Increased Spending: Recipients spent an average of $310 more per month, primarily on essentials like rent, food, and transportation.
Financial Support: Participants were more likely to provide financial assistance to others in need compared to the control group.
Employment and Agency
Work Engagement: Recipients worked slightly less (1.3 to 1.4 hours less per week) but remained engaged in the workforce. They were more deliberate in their job searches, seeking employment that aligned with their values and preferences.
Increased Savings: Total individual savings for recipients increased by nearly 25%.
Health and Well-being
Mixed Health Outcomes: While there was a slight uptick in healthcare spending and emergency room visits, researchers found no direct evidence of improved health outcomes. Some benefits, such as reduced stress and food insecurity, diminished over time.
Mental Health: Initial reductions in mental distress were noted, but these effects faded by the second and third years of the program.
Implications for Basic Income
Agency and Decision-Making: The study highlighted that cash payments provided recipients with greater agency, allowing them to make decisions that better suited their lives, such as moving to better neighborhoods or pursuing new business ventures.
Long-term Viability: Altman believes that as AI continues to reshape the job market, a form of basic income will be essential for ensuring equality of opportunity.