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One possible problem with Basic Income Guarantee proposals/models is that the theoretical goal of "an income you can live on" produces sharply different answers depending on "live on where" nuance of a real world.

High-cost urban cities - where many poor people actually live - sometimes have rent costs that exceed the whole cost of living in cheaper but less prestigious place like some rural area.

E.g., randomly checking, 1-bedroom condo for rent in Muskogee, OK (680 Sq Ft) is $360/month (I picked that place because I visited there and it's a safe, neat town). The cheapest, rent-controlled, worst-least-safe-parts-of-NYC studio apartments typically run $700-$900/month; and without rent control $1500-$2000/month seems normal. NYC suburbs in reasonably safe area are $1100-$1200/month.

Are there any proposals or models of Basic Income Guarantee that include a plan that getting the money is contingent on moving to less expensive part of the country (either as specific plan of proposal, or simply by allocating the income amount to be enough to live on in Oklahoma but not New York)? Possibly to include one-time relocation costs, to ensure people actually are financially able to move.

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    "Are there any proposals like that?" Sure, the moment you write one :). There are more nuances of proposals for basic income than there are proponents. What would be your criteria for a proposal to be notable enough to be an acceptable answer to this question? – Philipp Feb 2 '17 at 16:13
  • @Philipp - hopefully, something done by an expert. Preferably something academic-ish. Not a random dude on a random blog. – user4012 Feb 2 '17 at 16:17
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    Please don't turn this comment section into a debate about the pro's and con's of basic income. Whether or not such a BIG proposal is a good idea or not is not part of this question. – Philipp Feb 2 '17 at 17:06
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    A plan that is contingent on anything is not a universal income, that would defeat the whole purpose. – Relaxed Feb 3 '17 at 8:00
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    @user4012 Basic or universal, it's just the same concept. It's not a law of nature, but a definition. The minute you make it contingent on something, with endless debates on what's fair, a bureaucracy to enforce the rules, etc. you are talking about something else entirely. Which is fine, already exists and comes in many different flavours some of them somewhat related to your idea (like regular welfare payments, which are never that high that you could live comfortably in the most expensive neighbourhoods, or rent subsidies with constraints on which kind of dwellings qualify). – Relaxed Feb 3 '17 at 17:53
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Part of the problem of forcing people to move to cheaper areas is that it undermines one of the key advantages of UBI.

One of the arguments behind introducing a basic income is that it will enable people to look for better, more skilled jobs, and acquire the skills needed to perform them without having to work long hours at a low wage and having no time to train these better skills in order to merely survive.

The biggest driver of living in an urban area is that urban areas have more and better jobs. Moving these people to rural areas would trap them with only the basic income forever, never able to find a better job which they could otherwise obtain.

This is a perverse incentive as it means to get the supplies they need people must forgo the ability to get better work and earn more (and pay more taxes). It shares the same flaw as a traditional unemployment/welfare benefit in that it encourages actions that avoid the person working rather than using their new found money to develop themselves.

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    This assumes that rural areas cannot have employment, which is absurdly false, and suburbs are greater sources of low-skilled jobs than city centers. Increasing the UBI to afford living in housing-constrained areas only pushes up the rents in those areas - great for landlords who get to absorb all additional value as prices bid up to include the UBI, but bad deal for everyone else. If anything an influx of people earning the UBI would increase the economic activity of depressed areas, leading to a boost in the economy, which will then be facilitated by a larger labor pool. – pluckedkiwi Mar 18 at 15:23
  • @pluckedkiwi My understanding of this question is it was assuming an UBI which required people to live in a rural area to receive it. Else it would not be given. This would hurt peoples job prospects as not everyone can find a job in their field in the middle of nowhere. – Vality Mar 18 at 21:19
  • Some of the differences in employment between urban and rural areas are shown here: ers.usda.gov/topics/rural-economy-population/… – Vality Mar 18 at 22:12
  • I've never heard of an actual proposal requiring living in a rural area to get it, then it wouldn't be universal, just not adjust for locality only sufficient in areas with low cost of living (hence discouraging cities only because it affords $300 in rent, not $2000 in rent). There are employment differences, but this is a difference, not an absence of jobs. With a UBI more of the productive population would live in rural areas, providing a better workforce, which will retain employers. The "better" jobs being in the city is irrelevant to a UBI because those jobs pay well. – pluckedkiwi Mar 19 at 13:43
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Geographic variation of rent (which drives the geographic varion of many other living costs) is a hard problem for any welfare scheme.

But where will we live – and how will we pay for it? These are questions housing and social security experts have been asking ever since the blueprint for the welfare state was laid out by Sir William Beveridge in 1942.

His system combined benefits at subsistence levels and others based on insurance contributions with action by the state to create the NHS, family allowances and full employment. But he admitted there was one problem even he could not solve: “The attempt to fix rates of insurance benefit and pension on a scientific basis with regard to subsistence needs has brought to notice a serious difficulty in doing so in the conditions of modern Britain. This is the problem of rent.”

Rents vary from place to place. If you pay a flat-rate allowance for housing, people in expensive areas will not have enough to pay the rent, while those in cheaper places will have a surplus. If you make it part of the insurance benefit, what is to stop people moving to an expensive house the moment they retire?

Beveridge hoped his new system of social security would mean the end of the hated means test. He tried to “make the most of a difficult situation” by proposing a flat-rate housing allowance on top of contributory unemployment benefit. After the war the government decided to meet actual housing costs but means test claimants. Housing benefit (soon to be absorbed into universal credit) did improve matters but it costs £25bn a year, is costly to administer and relies on means testing and steep withdrawal rates.

So what can supporters of UBI do? Many proposals simply ignore housing costs (and the equally difficult area of long-term sickness and disability) but that means retaining a means-tested allowance that undermines the simplicity that is meant to be one of the main points of the idea.

Another option is to include a flat-rate allowance for housing, possibly on a regional basis to reduce the worst anomalies. But that would still mean some people receiving more than their rent, while leaving others unable to pay for a decent home and at risk of homelessness. As Donald Hirsch argued in a report for the Joseph Rowntree Foundation last year: “It seems unlikely that a government would walk away from providing targeted support to those unable to afford acceptable housing, risking a return to slum conditions that were largely eradicated in the UK in the post-war years”.

So you kinda have your answer in that last para: a UBI that would target just the lowest possible rent (for a wide area, e.g. country) is suspected to create slums (in the richer areas thereof).

And for a sort-of similar solution (mostly just in name):

A report published by the Royal Society of Arts in December floated the idea of a “basic rental income” granted to everyone who rents rather than owns a property, and with the additional costs incurred by central government paid for through a land value tax. It certainly seems a neat solution to use one idea fashionable across the political spectrum to fix the problems with another one – but is it a bit too neat?

The truth is that the “problem of rent” is an even bigger headache today than it was for Beveridge. At the time he produced his report there was strict rent control in the private sector, and Britain was about to embark on a massive programme of council house building. Now rents vary even more from place to place and the government is more intent on selling social housing than building, at the same time as it complains housing benefit is “out of control”.

And you have to dig pretty deep in the report to get to the actual proposal on rents

The third option which the RSA proposes for further exploration is the introduction of a ‘Basic Rental Income’. The Basic Rental Income would not be income-contingent and therefore does not have the same disincentive or perverse incentive (eg family break-up) effects as housing benefit and council tax credit. A Basic Rental Income based upon local market conditions (and this would vary from year to year) would be granted to every individual who rented rather than owned a property. It could be linked to continuous residency (three years minimum say) to increase local cohesion. Local authorities would retain their statutory duty to house the homeless and should be given freedom to borrow and invest in new low-cost housing. The Support for Mortgage Interest Scheme for house-owners who are out of work would continue as now. A Basic Rental Income would have cost implications. The source of funding for additional cost should be those who have gained the most from increases in housing equity. Philosophically, the justification for this has roots in Thomas Paine’s argument in favour of a ‘basic endowment’. The reason that there have been large gains for some in the housing market whilst others struggle is because our common institutions have failed to provide enough housing to enable affordable rents and housing ownership to be even more widespread. The introduction of a land value tax or similar to fund any shortfall in the Basic Rental Income is therefore justified on the basis of gains received by a few from the institutions of society and its collective action failures rather than through the individual’s endeavour.

This is a means of redistributing the economic rents that have arisen from the institutional structures of land and property. Some such as Adair Turner argues that cooling the housing market should be a ‘primary policy objective’ from an economic stability perspective. This policy would help quell some house price inflation as the demand for higher prices may be somewhat quelled.

Furthermore, both a land value tax and the Basic Rental Income together could provide for even more creative living spaces. Co-operatives could come together by aggregating Basic Rental Incomes giving power to individuals acting collectively to design these new creative living spaces. This opportunity could be open to all. The beauty of this system, in principle, is that the imposition of land value tax would release further land for development. The Basic Rental Income therefore becomes empowering in a way that Housing Benefit is not given its stigma and the lack of security it provides. This proposal could revolutionise the way many people live further enhancing freedom, creativity and security. A Basic Rental Income is for further modelling and exploration that is beyond the scope of this paper.

To me this BRI proposal doesn't answer some questions: what if it incentivises recipients to move to more expensive parts of the country? After all, life is probably better there in some ways, e.g. schooling might be better etc. I suspect such a scheme would accelerate some global demographic trends, increased urbanisation and depopulation of more rural areas. The proponents do envisage a sort of brake for this in the form of testing for length of residency etc. Whether that is a fair test is another matter.


A much more dramatic idea (basically communist IMO) is to complement UBI with a prohibition of private ownership of land, which would definitely solve the variation in rent... A "softer" version of this idea is to massively tax the land owners for the land value increase... The proponents of this argue that land owners reap value increases while doing almost nothing... And use these tax/funds to "fix" the housing market; not very clear to me how the latter part would be done; there's some vague talk of "going big" on UBI.

We’re running a project called New Thinking for the British Economy, and today an article by someone who is making the argument with UBI. The quote was, “Proponents of UBI need to go big or go home.”

I think what he meant is that by going big means that you need to take on this issue of ownership in the economy, kind of the root of the concentration of wealth. And that’s their agenda, and only by doing that will you really be able to get the UBI that is large enough, but also has acceptance that actually works.

And he was highlighting examples where he was quite worried that people are going straight in for the UBI or a halfway house UBI without touching the ownership stuff, and that, in his view, you could end up in not a very good place if you do that.

So you’re saying, yeah, go big and tackle the structural and make sure we go down that route. Otherwise, if it’s a kind of a halfway house UBI that doesn’t do that as well, then the outcomes you’re going to get aren’t going to be anywhere near as good. So it’s worth checking out, if you want to have a look at it.

The actual article that was published, doesn't quite have this title, but the "go big" is somewhere in there.

unless we are to engage in a radical economic transformation which drastically increases common ownership of economy, it is unlikely that Universal Basic Income on its own will do more than lock us into our current predicament. In the meantime, we need to look for equally radical policies which make a much more material difference to the lives of those on low incomes and who suffer from structural inequalities. Proponents of UBI need to go big or go home.

While this is still pretty vague, I guess you could read between the lines a proposal of Universal Basic Housing Ownership [I just coined this] or some such. Actually, a bit more googling found a proposal for Universal Basic Assets and [fairly predictably]

UBA should start with access to housing

And casting housing a service instead, a more concise proposal is for the state to provide rent-free housing under the umbrella of "universal basic services".

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Decoupling of income from location

The incentive to move to lower cost areas is implicitly included in the core UBI concept. For someone living off of UBI, they aren't required to live in a high-cost area (where previously they were required to live where the jobs are) and the same income gets them a better lifestyle in a cheaper area.

In order for UBI to function effectively, it doesn't need to be large enough so that people can afford to live anywhere. A person may have a de facto choice to live in a cheap area where UBI is sufficient or live in a more expensive area where rent alone is much higher than UBI, because they can afford it due to their high income; and there's no reason for any explicit treatment for this - in this case, basic market forces and natural incentives seem sufficient to get an appropriate allocation of resources and people.

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A city becomes a desirable place to live when it provides infrastructure and culture, so the city can only remain functional if low-earners stay nearby.

Rent only decreases significantly when I get far enough from the city that commuting is no longer a viable option. Service jobs cannot be performed remotely, so it is impossible to move workers out of the city.

At the same time, the city should also be interested in keeping artists around, who aren't the most solvent people either.

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    This doesn't address the question. Also, giving a UBI (or even just housing vouchers) will do nothing for allowing low-income people to live in housing constrained areas - the price of housing in a shortage will simply be bid up to include the additional subsidies. Only an increase in the supply of housing will allow more people to afford to live where there is currently such a shortage of housing - nothing else will change that. – pluckedkiwi Mar 18 at 15:27
  • If a city becomes starved for a certain kind of low-income worker, that would be solved by increasing such worker's pay, so they can afford to live there again. – hkBst Mar 22 at 11:46

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