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Digital Dividends to Fund Universal Basic Income Plans

Precision Agriculture
March 10, 2020
Self-Sovereign Identity
March 10, 2020

Digital Dividends to Fund Universal Basic Income Plans

A digital dividend would give citizens a cut of the profits derived from their personal data.

Key Insight

A digital dividend would give citizens a cut of the profits derived from their personal data.

Why It Matters

The idea of an unconditional guaranteed income for every citizen of a given country is now being discussed both as a means of encouraging entrepreneurial innovation, and as a response to workforce-displacing automation, advanced robotics, and artificial intelligence.

Examples

All eyes were on a test of this idea of universal basic income (UBI) in Finland, but the program came to an early close in 2018. It targeted only 2,000 randomly unemployed citizens and gave them 560 euros a month (that’s about $675) for two years. The model didn’t work there—but some experts believe that’s because other social welfare programs weren’t adjusted alongside the UBI program.

Early in 2019, then Democratic presidential candidate Andrew Yang launched a pilot UBI program in New Hampshire—if it is successful, and if he ends up in a future presidential cabinet, he would work to ensure that every American aged 18 to 64 would receive $1,000 every month, regardless of employment status.

The money to pay for this UBI initiative would come from consolidating social service programs and from a value-added tax (similar to current taxes in Europe) of 10% passed on to the consumer based on the value added at various steps in the production of goods.

There are city-scale experimental UBI programs now running in Oakland and Stockton, California. The Stockton project will give 100 randomly selected low-income families $500 a month for 18 months.

What’s Next

UBI programs may not be feasible going forward in many places, due in large part to sizeable aging populations and too few new workers entering paying jobs. A “digital dividend,” on the other hand, could be a viable alternate path to the future. Researchers at Oxford’s Institute for Humanity, researchers at the Future Today Institute, and former presidential candidate Andrew Yang separately published works outlining different versions of this digital dividend—a way for companies to pay back to society a portion of the profits derived from A.I. (See also: A.I. and digital dividends.)

The Impact

As the workforce changes due to automation, governments worldwide will need to find new alternatives to existing public support programs.

Watchlist

Future Today Institute, Oxford Institute for Humanity, Stanford Center for Philanthropy and Civil Society.