Lessons from the Finnish Basic Income Experiment

Abstract

<p> This study evaluates the Finnish Basic Income Experiment (FBIE) and its impacts on economic, social, and mental health outcomes. The FBIE provided a monthly unconditional basic income of €560 to long-term unemployed individuals, replacing the conditional minimum unemployment benefit. Linking experimental data to high-quality administrative registers, we assess both intended and unintended effects within Finland's comprehensive social security system. During the two-year experiment, basic income increased disposable income and reduced psychiatric drug use and primary care visits for mental health, though these effects largely faded afterward. No substantial impacts were observed on employment, geographic mobility, or fertility. Overall, the modest increase in economic autonomy did not translate into major life changes but was associated with short-term improvements in mental health.</p>