Tuesday, June 14, 2005
Basic Income has No Effects on Marriage
Blimpish wrote a long post opposing a Basic Income from a conservative point of view. Overall, I was suprised how good it was: Very few of his factual assertions about a basic income were misleading, he rather argued that what is known about the effects of a basic income are likely to be bad according to the type of society conservatives want. For example, he pointed out that results of negative income tax experiments show that they encourage single mothers and mothers with working husbands to stay home with their children rather than enter the workforce. Apparently, this is something conservatives do not want. Growing up in the seventies listening to debates among adults about feminism, I got the opposite impression of what conservatives wanted women to do, but apparently I was mistaken.
At any rate, Blimpish make one factually incorrect assertion about the effects of a basic income that I want to correct. But let me emphasize, this is not his fault. He takes his information about the effects of a basic income from the final U.S. government report on the findings of the Seattle-Denver Income Maintenance Experiment (SIME/DIME), and links to the report. Blimpish states:
SIME/DIME seemed to have a major negative impact on 'marital' (the couples didn't have to be married) stability. Amongst both black and white (less so Hispanic) families in the sample, the rate of 'marital' dissolution increased by over 40%, with the rate only reducing where there were high (and therefore labour-reducing) basic payments.
chris dillow responded to several of Blimpish's points. As to the marriage instability issue, dillow wrote:
4. CBI would increase marital break-ups.
The SIME/DIME, cited by Blimpish, seems to have done this.
And this is one of its many advantages. In giving women a guaranteed income, it increases their ability to leave abusive relationships.
As it happens, I was on a panel for a roundtable discussion on the economics of a basic income at The Fourth Congress of the U.S. Basic Income Guarantee Network, where one of the presenters was Robinson Hollister, a professor of economics at Swathmore College, who discussed the findings of various negative income tax experiments. His presentation was essentially the same as his remarks chronicled here from a similar, earlier roundtable. As to marriage stability, he states:
The most commonly mentioned of the non-labor supply results was an erroneous finding by some sociologists from the initial analysis of the Seattle-Denver Income Maintenance Experiments that the marriage-dissolution rate for black families in the experimental groups was 57% greater than the control group and 53% greater for white families. When these results came out in congressional hearings, Senator Moynihan, who had been a backer of Nixon's Family Assistance Plan, and who had written a very controversial report about instability in the black family, recanted his support for the guaranteed income. Those particular findings greatly contributed to killing the Carter administration's effort for a guaranteed income scheme. In the 1980s, Glen Cain carefully reanalyzed the data from Seattle-Denver experiment. The results were quite technically quite complicated, but there was basically no family dissolution effect. Some of the results were suspect from the beginning, because the effect seemed to occur in the sector of people with the lowest guarantee rate, the lowest incentive to strike out on their own; the recipients who had the least to gain from breaking up showed the largest amount of marital breakup. Cain's study appeared in the American Journal of Sociology in 1990, with a rebuttal by the authors of the original findings, but subsequent studies (and those from the other NIT experiments) also found no effects on marital stability.
He also states:
The Minnesota experiment found positive effects for marital stability and reduced domestic abuse. In the Canadian experiment, we found an increase in marital stability in New Brunswick and a decrease in marital stability in British Columbia.
In my comments, I got a laugh from the crowd by stating that I was disappointed to learn that the NIT experiments showed no decrease in marital stability, because one of the reasons I supported a basic income is because I thought it would make it easier for poor women to leave abusive relationships. But regardless of what dillow and I desire and Blimpish fears, it apparently did not happen. There is no effect on mariage stability from an NIT.
As to the negative effect on work by husbands shown by the NIT experiments, the way Blimpish descibes the form of the disincentive is very different from the way Hollister describes them, but the overall effect of the disincentive is about 10%, as he states. One response I would give is to point out that most basic income proposals suggest giving the basic income to everyone, regardless of income, while the the SIME/DIME was an NIT experiment with a 50% take-back rate. It should be unnecessary to explain to conservatives how a 50% income tax rate can create work disincentives.
The last two substantive paragraphs of Blimpish's posts:
My point is this: as much as the public do, rightly, care about social justice (however you define that), equalising economic outcomes for all isn't what they're driving at. There are big social problems in this country, and in many cases a lack of income and assets is one part of it - but the lack often isn't the problem, but a symptom of it. Giving the Left CBI opens the door to egalitarian solutions that we oppose not only because we object to the idea of an unconditional right to share the wealth, but because it's a cop-out to actually dealing with those social problems.
Rather than passing a family a bit of cash in the hope that they'll feel included in our 'community', while the child's mum can't stay off heroin and their dad flits between their house and those of his other children, and prison because he keeps getting into fights down the pub... maybe we should try to do something to help these people sort their lives out? Not to sound like a Leftie, but wouldn't it be nice to try to get to the 'root causes' here, rather than hoping a few quid might fix it?
Some further findings of the NIT experiments, as reported by Hollister:
The rural experiment in North Carolina and Iowa collected data on educational attainment. In North Carolina there were significant positive influences in grades 2-8 in attendance rates, teacher rating, and directly on test scores. The literature on education shows that it is nearly impossible to raise test scores through direct intervention. Yet, BIG had large desirable effects for the test scores of children in the worst-off families in the rural South. The New Jersey experiment didn't collect data on test scores, but there was a very significant effect on school continuation; that is, BIG was an effective anti-drop out program. And again, if you look at programs that are trying to reduce dropouts directly, it's a pretty dismal scene. In Gary, there were positive test score effects for males in grades 4-6. In Seattle-Denver, there was a positive effect on adults going on in continuing education.
Some of the experiments collected data on low birth weight, nutrition, and other quality-of-life effects. Low birth weight is associated with very serious deficits later on in life, and programs that try to reduce the incidents of low birth weight have been largely ineffective, but the Gary experiment found that the NIT reduced the low birth rate in the most at-risk categories. The rural experiment showed significant effects in various categories of nutritional adequacy. Homeownership showed significant effects in New Jersey, in the rural experiment, and in the first year of the Gary Experiment.
Score more points for giving people, even the poor, freedom instead of trying to micro-manage their lives.