Which guaranteed minimum income regime - workfare, participation income or basic income - works best for employment, health and wellbeing? › view all

Lecture by Prof. Ruud Muffels

Social Sciences Lecture Series with Prof. Ruud Muffels (Tilburg University) on "Which guaranteed minimum income regime - workfare, participation income or basic income - works best for employment, health and wellbeing? Results from a systematic review of experimental studies worldwide and six Dutch local experiments in Social Assistance."

Abtract

In this lecture, the findings and alleged policy implications are presented of two recently performed effect studies: 1. a systematic review of 48 experimental and simulation studies on Participation and Basic Income reforms and 2. the implementation and effect study of six Dutch local randomized controlled trial (RCT) experiments in 2017-2020 among nearly 4,000 beneficiaries of social assistance.

The review study covers not only the employment effects, but also the broader (un)intended effects on income, (mental) health, subjective wellbeing and related social outcomes: trust, social participation, substance abuse and crime. Results show that not a full or partial Universal Basic Income, but a Negative Income Tax and Participation Income or conditional Basic Income policy reforms create the best balance between efficiency (employment) and equity (income inequality, poverty) with respect to the various social outcomes studied.

The six official Dutch RCT experiments were held in Groningen, Utrecht, Tilburg, Wageningen, Deventer and Nijmegen. The main question was whether three alternative treatments or support regimes of welfare recipients may further their employment and improve their well-being, health and trust? The interventions were (1) exemption of job search obligations and rendering more trust and autonomy to the recipient for self-reliance, (2) tailored support and extra counselling for improving the reintegration into (part-time) work and (3) extra income through a work bonus (reduced benefit claw-back rate) to reward beneficiaries for finding work (they can keep 50% of their earnings up to 200 euro per month).

We found no evidence that the alternative interventions have reduced employment effects compared to current ‘workfare’ practices. In some municipalities we even find small positive significant effects for the extra support group and the work bonus group on part-time work in one city (Utrecht) and positive but mostly insignificant effects on wellbeing and trust.

The use of field experiments for testing the outcomes of alternative support regimes provides new avenues for welfare state and notably reintegration policies for people on welfare and notably of people with inadequate skills or bad (mental) health and lack of opportunities. Concerns about the increasing inequalities in employment and income prospects stem notably from the alleged impact of automation and technological progress on the labour market requiring the rethinking of the basic premisses on which the current welfare state is built.

^{Somers, M. A., Muffels, R. J. A., & Kuenn-Neelen, A. (2021). Micro- and macro-economic effects of Unconditional Basic Income and Participation Income: a systematic review. Technequality Paper Series, p. 1-65, Tables p. 1-36.}

^{Muffels, Ruud, Arjen Edzes, Peter Gramberg, Richard Rijnks & Viktor Venhorst (2021), Which Regime Works Best in Social Welfare? Comparing Outcomes of eight Dutch RCT Experiments, Technequality Paper Series, European Commission, p. 1-71.}

About

Prof. Dr. Ruud J. A. Muffels is professor of socio-economics at the Center for Care and Wellbeing and the Department of Sociology of Tilburg University. Before, he was Director of Reflect – a Research Institute on Flexicurity and Labour Market Dynamics at Tilburg University. He is also research fellow at NETSPAR, the network for research on ageing, and fellow at research institutes in Berlin (DIW) and Bonn (IZA).

His research interests concern subjective wellbeing and health, labour market dynamics, inequality and poverty, ageing and pensions and comparative welfare state analysis. He has published more than 300 papers in a wide range of economic, sociological and interdisciplinary journals and in international academic volumes.

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Online lecture via Zoom: tba