Author 

Lee, Seungju

Title

Will universal basic income increase work disincentives in South Korea?

Year

2020

Abstract

One of the most controversial aspects of universal basic income (UBI) is its effect on labour supply. In light of this, this study aims to simulate the labour supply reaction to the net income change when UBI is provided, thereby providing some insight into whether UBI causes work disincentives that its opponents often cite. This study proposes two different models of UBI and simulates their labour supply effects. Based on the simulated results, the study suggests that the negative effects of UBI on labour supply are not as strong as its opponents suggest.

Key words: universal basic income, labour supply effect, empirical basic income models, discrete choice analysis, simulation method