Germany is set to trial providing citizens with a universal basic income, launching a three-year study of how receiving a non-means tested guaranteed flat-rate monthly sum from the state affects the economy and recipients' well-being
The study is being organised by the German Institute for Economic Research and has been funded by 140,000 private donations.
It will see 120 people paid €1,200 (£1068) each month for three years. Researchers will monitor their experiences compared with another group of 1,380 people who will not receive the payments.
All participants will be asked to complete questionnaires about their lives, work, and emotional state to see whether a basic income has had a significant impact.
Those who are in favour of a lump sum non-means tested payment in place of a system of benefits argue that it would reduce inequality and improve people’s financial security.
Opponents claim it would be too expensive and discourage people from going to work.
Interest in universal basic income models has increased since Covid-19, as countries look at ways to addressing growing unemployment.
Finland was the first European country to trial the approach when 2,000 unemployed people were paid a monthly tax-exempt basic income of €560 regardless of any other income they may have had or whether they were actively looking for work.
The study ran for a year in 2017 and 2018 and compared the experiences of recipients selected through random sampling with those who received an unemployment benefit but were not selected for the experiment.
Those who had universal basic income payments were generally more satisfied with their lives and experienced less mental strain, depression, sadness and loneliness than the control group.
In some cases participants were able to take low-paying jobs they would otherwise have avoided, or spend time as volunteers on local projects. However, it was not clear whether the payments provided a boost to employment overall.
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