Will Universal Basic Income Solve Economic Challenges Amidst AI Disruptions?

The high cost of living and rising artificial intelligence are impacting low-income households, leading some to advocate for a Universal Basic Income (UBI). A recent study, funded by Sam Altman, explored UBI’s effects, revealing mixed results. While UBI showed potential benefits, such as improved well-being, labor market participation declined.

The current economic climate, marked by a rising cost of living and rampant advancements in artificial intelligence, is disproportionately affecting low-income households. Many are now looking towards Universal Basic Income (UBI) as a viable solution.

A UBI scheme, unlike traditional means-tested benefits, provides all citizens with a basic income regardless of their economic status. Though this approach could be costly for governments, it promises to alleviate financial insecurity.

Recent studies, including one funded by OpenAI's founder Sam Altman, investigated UBI's impact. The findings highlighted improved well-being but also noted a slight decrease in labor market participation, raising questions about its overall effectiveness. Policymakers now face the task of balancing these outcomes while considering the future implications of AI-driven automation.

(With inputs from agencies.)