Zero Hedge by Tyler Durden 7/22/2022
The "experts" didn't expect it to turn out this way. An experiment conducted by Harvard University and University of Exeter social scientists found no-strings-attached handouts harmed low-income recipients rather than help them.
Funded by an anonymous nonprofit, the study centered on an experiment in which 2,073 low-income people were randomly selected to receive a single, unconditional cash transfer of either $500 or $2,000. Another 3,170 low-income study subjects received no money from the study.
The experiment was conducted from July 2020 to May 2021. On average, the subjects were earning roughly $950 a month while receiving another $530 in food stamps and other government benefits. A little over half were unemployed and 80% had children.
Over a 15-week period, participants were periodically surveyed about their financial, physical and mental health. Across a wide range of financial and non-financial attributes, researchers found no positive effects on those who received free money -- but plenty of negative ones.
For a few weeks, people who received the extra money spent more than the control group -- $182 a week for the people who received $500, and $574 a week for the ones given $2,000.
The additional spending didn't bolster their financial health. The handout recipients reported the same rate of overdraft fees, late-payment charges and cash advances as did those who didn't receive the extra money. And it was all downhill from there. The handout recipients reported:
• Less earned income
• Less job satisfaction
• Lower work performance
• More financial stress
• Less liquidity
• Worse sleep
• Worse physical health
• More anxiety
• More loneliness
More:
https://www.zerohedge.com/economics/new-study-sledgehammers-universal-basic-income-arguments