Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/177160 
Year of Publication: 
2018
Series/Report no.: 
IZA Discussion Papers No. 11356
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
What are the effects of universal and permanent cash transfers on the labor market? Since 1982, all Alaskan residents have been entitled to a yearly cash dividend from the Alaska Permanent Fund. Using data from the Current Population Survey and a synthetic control method, we show that the dividend had no effect on employment, and increased part-time work by 1.8 percentage points (17 percent). Although theory and prior empirical research suggests that individual cash transfers decrease household labor supply, we interpret our results as evidence that general equilibrium effects of widespread and permanent transfers tend to offset this effect, at least on the extensive margin. Consistent with this story, we show suggestive evidence that tradable sectors experience employment reductions, while non-tradable sectors do not. Overall, our results suggest that a universal and permanent cash transfer does not significantly decrease aggregate employment.
Subjects: 
unconditional cash transfer
universal basic income
labor supply
employment
JEL: 
H24
I38
J21
J22
Document Type: 
Working Paper

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