Universal basic income has been considered an essential tool for addressing poverty and reducing social inequalities in many countries because it provides everyone with a level of income to meet basic needs such as food, housing, and clothing to address the root of poverty. Therefore, many think it is a panacea for fighting poverty and reducing social inequalities. It has been applied to some extent during the COVID-19 pandemic through cash transfers to population groups. However, there are several potential disadvantages to universal basic income, such as high cost, reduced incentive to work, and additional money given to those not needing it.
From the societal perspective, policymakers often refer to affordability, adequacy, and simplicity as the drawbacks of a universal basic income. Martinelli (2020) introduced these features as a basic income trilemma. Since the universality of basic income tends to make it unaffordable to governments as policy, Atkinson (1996) built a case for a participation income, an income conditional to various employment, unemployment conditions, and education conditions instead. The participation income would complement existing social security plans without replacing them with a one-size-fits-all policy. With the affordability introduced by the participation income came along the benefit of adequacy, allowing a wide variety of social needs to continue to be satisfied through a revised form of basic income stemming from relaxing the unconditionality feature of universal basic income.
Building upon Atkinson’s participation income, Reciprocitas’ participation incentive given to a subset of the population that is voluntarily organized in mutual aid groups for carrying out common interest work in their locality of residence further relaxed affordability. A participation incentive is more affordable in Haiti. The tremendous benefit of the participation incentive is its simplicity, requiring only a cash transfer to each mutual age group member using a regular debit card. However, it is worth noting that this approach can become unaffordable due to its high cost and relative inadequateness because it cannot accommodate specific social needs. Like Atkinson’s (1996) participation income, the participation incentive did not entirely remove the trilemma: affordability, adequacy, and simplicity.
References Atkinson, A. B. The case for a participation income. The Political Quarterly, 67(1), 67–70. https://doi.org/10.1111/j.1467-923X.1996.tb01568.x Martinelli, L. (2019). A Basic Income Trilemma: Affordability, Adequacy, and the Advantages of Radically Simplified Welfare. Journal of Social Policy, 49(3),1-22. https://doi.org:10.1017/s0047279419000424