Say the robots really do take over -- or at least take over many, many more of our jobs.
In that case, Y Combinator president Sam Altman wants us to be prepared. In a recent blog post, he notes that Y Combinator's research arm is looking to fund a five-year study to run a minimum income experiment -- one in which a group of people are given money to live on, regardless of whether they work or do anything considered productive.
The questions Altman is looking to answer are broad, and, in many cases, the answers will be hard to measure. As he writes:
Do people sit around and play video games, or do they create new things? Are people happy and fulfilled? Do people, without the fear of not being able to eat, accomplish far more and benefit society far more? And do recipients, on the whole, create more economic value than they receive?
In other words, will people keep working, and do they like it? There's another angle to consider, as well: What would a minimum income do to entrepreneurship?
From wage labor to entrepreneurship.
Obviously, not every able-bodied adult who receives a minimum income is going to quit his or her job. But if enough do, it could become a big economic problem. Structured as a so-called negative income tax -- where those who earn very little get a cash payment -- there were four experiments with minimum income in the U.S. in the 1970s. Those produced some -- albeit inconclusive -- evidence that people who receive a guaranteed minimum income might work a bit less.
A decrease in hours worked is not necessarily a bad thing. The problem is that we don't know what people were doing if they suddenly had more free time. "It's not a pure loss if people work less and spend more time caring for family or more time in school," says Matt Bruenig, a poverty researcher at Demos, a think tank in New York. "There are gains on the other side of that."
That's why Bruenig would urge the Y Combinator study to include a time-use diary. "You can have people track their hours and keep diaries," says Bruenig. "If you get enough people you can see how their time use changes."
Residents of Dauphin, Manitoba, received a minimum income from 1974 to 1978. And it's not like everyone quit their jobs en masse. "Just about everything they found of people who worked less were people you would want to be spending less time in paid employment," says Michael Howard, a professor at the University of Maine and the co-editor of the journal Basic Income Studies. That includes mothers with young children and high school students who stayed in school rather than getting jobs. An analysis of records from Dauphin also found a decrease in hospital admissions.
Another study, which ran in three rural villages in India from 2011 to 2013, showed that with a minimum income, people worked more overall. But they shifted some of their time spent working away from wage labor and spent more time on entrepreneurial ventures. This was particularly the case for women. In India, nutrition also improved greatly, and with it the health of children and their ability to stay in school.
In the U.S., Howard says he wouldn't be surprised to see shifts in the labor force as well. "People might not want certain jobs," he says. "They may prefer to do more self-employed things."
A bonus for entrepreneurs?
While entrepreneurs have reputations as an almost unreasonably independent group of people, a study conducted in Finland, where a pilot program granting basic income is to begin in 2017, found that 63 percent of entrepreneurs say they would support a basic income. The only group more in favor of basic income, with 71 percent approving, were those who are unemployed. Some 57 percent of students liked the idea, as did 46 percent of those receiving pensions.
"The minimum income would sort of be your pay as an entrepreneur," says Bruenig. "It would give you an opportunity to live on $12,000 a year while you're building your startup. I think that's probably pretty appealing to Silicon Valley."
There is other evidence, albeit indirect, that improving the social safety net could encourage entrepreneurship. A European study found that in Germany and Great Britain, those who experienced financial windfalls were more likely to become entrepreneurs. A study in the U.S. found that when the food-stamp program was expanded, those who were newly eligible were 20 percent more likely to become entrepreneurs. Could a basic income -- even in just one modest experiment -- do the same thing?