Inequality and Universal Basic Income: The Case of Ecuador

Abstract:

The COVID-19 pandemic renewed interest in universal basic income (UBI) as a tool to mitigate the impacts of the multiple crises. Although the advantages of UBI are well known, ie, universal, unconditional, and sufficient, specific country studies must be conducted to analyze particular conditions. This paper examines the implications of adopting UBI policy in Ecuador. In this context, we analyze the effects of UBI on income inequality and the economy using a computable general equilibrium model. The main findings show that targeted scenarios reduce inequality more than the universal ones. Additionally, we find that universal scenarios boost economic activity more than the targeted ones. However, although the positive results obtained in this analysis, the strict implementation of UBI program in Ecuador does not appear feasible in the short term because of complex existing economic, social, and political conditions.

Año de publicación:

2022

Keywords:

Fuente:

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