A recently published study reports on a three-year pilot project for testing the concept of an unconditional basic income. It shows that people who regularly receive a basic income of €1,200, with no questions asked, are significantly happier than before and do not stop working. Professor Susann Fiedler, head of WU Vienna’s Institute for Cognition & Behavior, and an international team of researchers investigated the effects of an unconditional income on labor market participation, mental health, and consumer behavior. As the first study of its kind, the research lays the groundwork for putting the debate on the idea of an unconditional basic income on a new, evidence-based foundation.

The study results are based on data collected from 107 basic income recipients and 1580 people in a comparison group. The subjects were regularly surveyed on their use of money, their labor market behavior, and their well-being.

Greater life satisfaction and better mental health

The subjective well-being of the basic income recipients improved significantly. Their general life satisfaction increased by 42 percent of one standard deviation. “Another remarkable thing to note is that this effect remained very stable over the entire course of the study. We didn’t see any habituation effects,” says study author Susann Fiedler, a professor of business and psychology at WU Vienna. Mental health metrics also improved by 30 percent of one standard deviation. “The increases in life satisfaction and mental health that we’ve seen come as particularly good news in times when sick leaves due to mental illness are going up,” adds Fiedler.

Objective facts to help refocus a polarized debate

This field study debunks the widespread stereotype that an unconditional basic income turns people into lazy free riders. The findings provide empirical data that can help to refocus the public debate on this topic, which has become very polarized. The Covid-19 pandemic has shown that cash payments can play an important role during times of crisis and that they can help make societies more resilient.

The project was carried out in cooperation with the association Mein Grundeinkommen, which funded the basic income cash payments from donations. Based on a cooperation agreement between this association, the German Institute for Economic Research (DIW Berlin), and WU Vienna University of Economics and Business, the researchers involved had complete scientific freedom and worked with full independence in conceptualizing the project and analyzing the results.