The Employment Effects of a Guaranteed Income: Experimental Evidence from Two U.S. States
This study explores the causal impacts of income on a rich array of employment outcomes, leveraging an experiment in which 1,000 low-income individuals were randomized into receiving $1,000 per month unconditionally for three years, with a control group of 2,000 participants receiving $50/month.
A large-scale randomized controlled trial in Texas and Illinois provided $1,000 per month in unconditional cash transfers to low-income individuals and found a moderate reduction in labor supply, with labor force participation about 2 percentage points lower and 1.3–1.4 fewer work hours per week compared to the control group.
The guaranteed income did not significantly improve job quality or human capital, and most extra time was spent on leisure, indicating a shift toward personal choice in time use rather than enhanced long-term employment outcomes.
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