Picture: iStock

Universal Basic Income

Picture: iStock

The idea of an unconditional universal basic income (UBI) is to grant everyone resident in the country a welfare benefit that is sufficient to ensure a minimum livelihood but has no specific qualifying criteria.

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The proponents of this scheme point out that UBI is liberating because it removes the need to work for a living. The current social security bureaucracy could be largely eliminated and everyone could pursue their own personal development without any economic constraints.

However, our society is based on the principles of subsidiarity and solidarity. Subsidiarity means that everyone is first and foremost responsible for themselves, so that only those who are genuinely unable to shoulder this responsibility benefit from the solidarity and support of their fellow-citizens. Yet everyone would receive UBI, regardless of whether they wanted, or needed, support. Moreover, such a radical restructuring of the welfare state would have a significant impact on the labour market, as many employees are likely to ask themselves why they should continue to work.

A further drawback would be the immense costs. A thousand euros a month, multiplied by Germany’s 80 million inhabitants, multiplied by the twelve months of the year, adds up to an annual gross funding bill of 960 billion euros. This would mean a huge hike in taxes, with the consequence that, at least financially, investing in education and committing to a profession would hardly be worthwhile.

Dominik H. Enste

Prof. Dr. Dominik H. Enste

Head of the Research Unit Behavioral Economics and Business Ethics

Tel+49 221 4981-730



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Holger Schäfer

Holger Schäfer

Senior Economist for Employment and Unemployment

Tel+49 30 27877-124



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