Can We Solve Homelessness Through Basic Income?
New research finds…
A recent study conducted in California's Los Angeles County and San Francisco Bay Area involved providing about 100 homeless individuals with a $750 monthly stipend for a year—no questions asked. The results from the first six months of this research initiative reveal a drastic transformation in the lives of those who participated.
Key Study Findings:
- Increased Shelter Access: Participants who received the $750 monthly stipend were significantly less likely to report being unsheltered after six months.
- Closer to Meeting Basic Needs: Recipients expressed progress toward meeting their fundamental needs, dispelling the myth that direct financial assistance may not be practical.
- Spending Patterns: The study explored how participants allocated their funds, with the highest share (36.6%) spent on food, demonstrating an immediate impact on essential needs.
Dispelling Myths and Empowering Individuals:
The study by the San Francisco nonprofit Miracle Messages and the University of Southern California Suzanne Dworak-Peck School of Social Work challenges preconceptions about how individuals experiencing homelessness might use financial assistance. Only about 2% of the $750 per month was spent on alcohol, cigarettes, or drugs, with the majority being used responsibly.
Empowering Personal Choices:
Ben Henwood, the Center for Homelessness, Housing, and Health Equity Research director at the USC Suzanne Dworak-Peck School of Social Work, emphasized the importance of empowering individuals to focus on their unique needs. Participants reported using the funds for bills, car repairs, and immediate food requirements, highlighting the diverse and crucial ways financial assistance can make a difference.
Positive Impact on Homelessness Rates:
For those who received the funds, the proportion of people reporting being unsheltered dropped from 30% at the start of the trial to under 12% at the six-month follow-up. While the control group also saw a decrease, the impact was less significant, decreasing from 28% to 23%.
Year-Long Impact Assessment:
Researchers plan to release a follow-up report based on the entire year of data, offering a comprehensive view of the long-term effects of this transformative initiative. While the results are positive, we know from the work of, John List, and Dana Suskind that scalability of these experiments towards policy can cause challenges.
Joining a Wave of Positive Change:
This study adds to a series of basic-income experiments across the United States, showcasing the positive impact of providing direct financial support to those in need.
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Study Executive summary
Website of the organization
Business Insider article
Study Protocols and White paper: