- OpenAI CEO Sam Altman has published research results on a guaranteed basic income.
- Although overall expenses increased, most of the surplus money went towards food and rent.
- Recipients felt less financial stress, but that stress faded over time, the study found.
The long-awaited results of Sam Altman’s basic income study, the largest of its kind, are in. The experiment gave low-income participants $1,000 a month for three years, no strings attached.
The study found that recipients spent most of their extra money on basic needs like rent, transportation and food, and that while they worked fewer hours on average, they stayed in the workforce and were more cautious about job hunting than control groups.
“Recipients now have greater agency to make the best decisions for their lives and prepare for the future, from moving to a new neighborhood to expressing interest in a new business,” the report’s authors said.
Altman, CEO of leading artificial intelligence company OpenAI, raised $60 million for the study, including $14 million of his own money, which was conducted by OpenResearch and led by researcher Elizabeth Rose.
It officially launched in 2019 and enrolled 3,000 urban, suburban, and rural residents in Texas and Illinois. All of them had incomes below $28,000. One-third of the residents received $1,000 per month for three years, while the rest received $50 per month in a control group. No participants lost their existing benefits.
The study found that recipients of the $1,000 payment increased their total monthly expenses by an average of $310, most of which went to food, rent, and transportation, and provided more financial support to others in need compared to the control group.
But the researchers said they found no “direct evidence of improved access to health care or improved mental or physical health” among those who received the $1,000 payments.
“While there were significant reductions in stress, mental distress, and food insecurity during the first year, these benefits faded in the second and third years of the program,” the report said, pointing out that $1,000 a month has limitations: “Cash alone cannot address issues such as chronic health problems, lack of child care, or rising housing costs.”
The debate over basic income
The study was inspired by Altman’s belief that a basic income is important in the age of AI, which some fear will result in the loss of millions of jobs.
“It’s impossible to achieve true equality of opportunity without some form of guaranteed income,” Altman said when announcing the project.
The idea of universal basic income has been around for a while, but it rose to prominence as a central part of Andrew Yang’s 2016 presidential campaign, and other key figures in the tech industry have since voiced their support. Many people, including Twitter co-founder Jack Dorsey and Tesla CEO Elon Musk, have called for some sort of basic income, and AI godfather Geoffrey Hinton recently advised the UK government to introduce universal basic income to reduce the number of “menial jobs” that are replaced by AI.
Universal basic income would provide direct cash transfers to everyone, with no strings attached. But it comes with significant political costs. Many cities and states are experimenting with guaranteed basic income instead. These programs provide unlimited cash transfers to certain low-income or vulnerable groups. Altman’s study falls into this group.
Data from dozens of these small programs find that cash transfers help reduce homelessness, unemployment, and food insecurity, but the findings still highlight the need for local and state governments to invest in social services and housing infrastructure.
Earlier this year, Altman also proposed another kind of basic income scheme, which he called “universal basic computing.” In this scenario, Altman said, people would get “a portion” of the computing resources of the massive language model GPT-7 and be able to use it however they like.
“Part of your productivity is your own,” he explained on the podcast.
But even these small-scale experiments face political obstacles, with conservatives in several states challenging the programs and blocking their progress.
Findings from the Altman Study
Altman’s study evaluated both quantitative data, such as surveys and bank transactions, and qualitative data, such as interviews with recipients.
The study found that total personal savings in recipients’ bank accounts increased by about 25 percent compared to the control group. Recipients also spent $22 more per month on others, about 26 percent more than the control group. There was little impact on car or home ownership, but recipients of the $1,000 were more likely than the control group to move to a neighborhood or pay more for housing.
With regard to health care, recipients experienced small increases in dental care, emergency room visits, and medical costs compared to controls, but there was no direct evidence of improved health outcomes.
Recipients were more likely than controls to have secured funding and to want to further their education, especially in the third year, but there was no significant effect on overall educational attainment.
The study, launched during the COVID-19 pandemic when unemployment was high, found that employment rates declined in years two and three when comparing recipients with controls. On average, all groups saw a large increase in income, but it was slightly higher for the control group. Recipients of $1,000 saw their income increase from just under $30,000 to $45,710, while the control group’s income started at a similar level and increased to $50,970.
“Cash may provide flexibility and increase recipients’ freedom to make employment decisions that fit their personal circumstances, goals, and values,” the report authors said.
Opinions of participants in Altman’s basic income study
One of the program’s recipients is Sarah, a mother of four who lives in rural Illinois and is a teacher in a homeschool network who earns enough from her job to buy school supplies.
“I didn’t make anything from it,” she said in a testimony shared by Open Research. “My husband had a reasonably good job, but we didn’t have any extra money.”
Payouts from the Altman program helped pay for orthodontic costs for her two children that weren’t covered by insurance, Sarah said. She also used the money to fund her daughter’s graduation trip.
But Sarah said she “started to fall into a mindset” that led her to not pay as much attention to managing her money because it felt like money was coming in “without working.”
“Looking back, I wish I had saved more,” she said.
Another subject, Carla, told researchers she suffers from a debilitating neurological disorder that causes pain and reduced mobility over much of her body.
She began receiving short-term disability benefits, but the break-in at her apartment left her in financial difficulty and she began selling personal belongings, she said.
“It’s hard when you lose your ability to look after yourself and you desperately need the help of others,” Carla said.
“I probably started crying” when she got the call from the Altman program saying she’d received $1,000, enough money to pay off nearly all of her debts.
“It felt like a miracle,” she says. “Knowing that I’d made it through that mountain of medical debt, it was like my brain was in a different place.”
Another participant, Celine, told researchers that she had lost money in business and had been forced to move her family into a friend’s house, where she said she lived in poor conditions.
When she got the call that she’d been selected to be part of a group that would receive $1,000 a month, she couldn’t quite believe it.
She said the money allowed her to buy new clothes, shoes and necessities for herself and her children. By the second month, she had found a job and started saving.
The money “helped me feel like I wasn’t a failure as a parent,” she said, and gave her confidence to make the best decisions for her family.
