Basic Income and Labour Market Conditions: Insights from Argentina

CORINA RODRÍGUEZ ENRÍQUEZ

Basic Income Studies

The Bekerly Electronic Press

Año: 2007 vol. 2 p. 1 - 6

1932-0183

It is assumed that the implementation of a basic income (BI) will have a notable impact on the labour market. However, there is no clear consensus about the sense or magnitude of that impact. Arguments in favour of BI suggest that the grant will give people more freedom to not accept low-quality jobs, will set a de facto minimum wage and will foster better labour-market conditions. BI will also allow people to develop activities outside the labour market (education, voluntary work, domestic chores, etc.), and will promote reasonable levels of employment by sustaining aggregate demand. By contrast, arguments against a basic income claim that a grant will create work disincentives, will lower the average wage since people will be willing to work for less money if given a BI, and will have no real effect on labour market protections. In the absence of real experience with BI, this comment assesses these arguments by reflecting upon experience with other forms of transfers and the reality of the Argentinean labour market.