The Future

A basic income solves the money question. It does not solve the question of why you get up in the morning.

UBI secures a living and props up consumer demand. It does not replace what paid work also delivers: status, a daily structure, the feeling of being needed.

In almost any debate about AI and the labour market, the unconditional basic income shows up around minute ten. It is a serious proposal, tested in several countries. It solves one problem. Not all of them.

What UBI can do is clear from the pilot studies. Finland, Germany, and Kenya have tried it, with different sums, durations, and target groups. The findings line up: no significant cut in working hours, clearly better mental health, higher self-rated security. The myth of the welfare hammock does not survive the evidence. Securing a basic living works.

At the same time, UBI would steady consumption. As AI agents take over more of the work that no longer carries any wage tax or social contributions, it is not only the funding side that collapses but the demand side too. People who earn no wage spend no wage. A basic income keeps the cycle turning. That is not a small point, that is macroeconomics.

What UBI cannot do is set out in a study published in Vienna in 1933. Marie Jahoda, Paul Lazarsfeld, and Hans Zeisel examined Marienthal, a factory settlement whose work had vanished. Material subsistence was secured through state support, but paid work was gone. The result was not revolt but apathy, resignation, the loss of daily structure, a shrinking sense of time. The comparison has its limit: Marienthal was total unemployment with no labour market at all, whereas a basic income would sit alongside a shrinking but still present one. The core problem lands all the same: being needed, a daily structure, status. Money is not the only thing work provides.

Three questions stay open. First, getting ahead: how does anyone earn more than the basic income when the regular labour market for their qualification is shrinking? Second, identity: in this society, paid work defines who a person is. A transfer with nothing given in return does not fill that role. Third, democracy: what happens to a democracy in which a growing share of the population does not feel needed?

UBI may be necessary. Sufficient it is not.

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What the pilot studies show

Finland, 2017 to 2018: the Finnish social insurance agency Kela paid 2,000 randomly selected unemployed people aged 25 to 58 an unconditional 560 euros a month. The final report in 2020 found the employment effects small and not statistically significant. Over the two years the recipients worked on average six days more than the control group. Their self-rated economic security and mental health, by contrast, were clearly better.

Germany, 2021 to 2024: the association Mein Grundeinkommen funded 122 people with 1,200 euros a month for three years. A consortium led by DIW Berlin ran the evaluation. The result: no significant cut in working hours, but markedly higher life satisfaction and better mental health, with no fading effect over the three years.

Kenya, since 2017: the US aid organisation GiveDirectly is running the longest ongoing controlled study of unconditional transfers. One group receives monthly payments for 12 years. The interim findings in 2023 showed more entrepreneurial activity and no sign of people withdrawing from work. As the longest running study, Kenya is the strongest empirical counterweight to the worry that transfers make people passive.

Why Marienthal still matters

The Marienthal study is now a classic of empirical social research. The textile plant the Lower Austrian settlement lived on had closed. Almost the whole town was out of work, supported by the state but with nothing to do. Only a small minority could still make plans for the future.

The 2009 meta-analysis by Paul and Moser (Journal of Vocational Behavior, 237 studies) confirmed the pattern in numbers: 34 percent of the unemployed show mental health problems, against 16 percent of the employed. The effect holds even after financial hardship is factored out.

What UBI does not replace

The question of getting ahead: a basic income is, by definition, a basic floor. Anyone who wants more than the minimum needs the regular labour market. If that market shrinks, UBI becomes a ceiling rather than a springboard.

The question of identity: the second question at any first meeting is "What do you do for a living?" A transfer has no answer to it.

The democratic question: the historical answer is not reassuring. Marienthal happened in the 1930s. What came after is well known.

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