You are here: Home » Opinion » Columns
Business Standard

Financial viability of universal basic income

One argument that is cited against UBI is that it may generate laziness. The experiment is Kenya, quoted by Abhijit Banerjee and Bardhan, shows that it does not

Topics
Universal basic income | Raghuram Rajan

Sukumar Mukhopadhyay 

Sukumar Mukhopadhyay

(UBI) is an elegant model for economists. It has now been attracting a lot of attention all over the world, including the rich countries. The scheme is that all people in the country will get some cash without any relation to the work. Abhijit Banerjee, the Nobel laureate, in his book Good Economics for Hard Times, has made an elaborate case for . He calls it ultra basic (UUBI) because "any universal income that governments of poor countries can afford will be ultra basic”. Hence UUBI (page295). He further adds: "Given all this, the best combination may be a UUBI everyone can access when they need it, and larger transfers targeted to the very poor and linked to preventive care and children's education." Professor Pranab Bardhan suggested in his articles in Business Standard (on June 9,10, and 11, 2020), a cash grant of Rs 20,000 to each family irrespective of rich or poor but has finally conceded that it need not be given as a practical measure to plutocrats. Raghuraman Rajan has talked only about the poor, "We have seen over time that giving money directly to the people is often a way of empowering them. They can use that money for the services they need." The of India proposed something like this in 2017. It estimated that an annual transfer of Rs 7,620 to 75 per cent of India’s population would push all but the absolute poorest above the 2011-12 poverty line. UBI is for mitigating insecurity and abject poverty and not inequality.

TO READ THE FULL STORY, SUBSCRIBE NOW NOW AT JUST RS 249 A MONTH.

SUBSCRIBE TO INSIGHTS

What you get on Business Standard Premium?

  • icon Unlock 30+ premium stories daily hand-picked by our editors, across devices on browser and app.
  • icon Full access to our intuitive epaper - clip, save, share articles from any device; newspaper archives from 2006.
  • icon Curated newsletters on markets, personal finance, policy & politics, start-ups, technology, and more.
  • icon Pick your 5 favourite companies, get a daily email with all news updates on them.
  • icon 26 years of website archives.
  • icon Preferential invites to Business Standard events.

OR

Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Sun, July 05 2020. 18:09 IST
RECOMMENDED FOR YOU
.