The results are in for Sam Altman’s much-anticipated basic income study, one of the largest of its kind. The experiment gave low-income participants $1,000 a month for three years, no strings attached.
Recipients put the bulk of their extra spending toward basic needs like rent, transportation, and food, the study found. They also worked less on average but remained engaged in the workforce and were more deliberate in their job searches compared to a control group.
“Recipients had greater agency to make decisions that worked best for their lives and to prepare for the future, from moving neighborhoods to expressing interest in new business ventures,” the report’s authors said.
Altman, the CEO of OpenAI, a leading artificial intelligence company, raised $60 million for the study, including $14 million of his own money. OpenResearch conducted the study, which was led by researcher Elizabeth Rhodes.
It officially began in 2019 when 3,000 Texas and Illinois residents across urban, suburban, and rural areas enrolled. All of these residents had incomes below $28,000. A third got $1,000 a month for three years, while the rest — the control group — got $50 a month. No enrolled participants lost their existing benefits.
The study found that those who received the $1,000 payments increased their overall spending by an average of $310 a month, but most of that spending went toward food, rent, and transportation. They also offered more financial support to others in need compared to the control group.
Researchers, however, said they found no “direct evidence of improved access to healthcare or improvements to physical and mental health” among those who received $1,000 payments.
“We do see significant reductions in stress, mental distress, and food insecurity during the first year, but those effects fade out by the second and third years of the program,” the report said, noting that $1,000 a month could only do so much. “Cash alone cannot address challenges such as chronic health conditions, lack of childcare, or the high cost of housing.”
The debate over basic income
The study was inspired by Altman’s belief in the importance of a basic income in the age of AI, which some fear could render millions of jobs obsolete.
“It’s impossible to truly have equality of opportunity without some version of guaranteed income,” Altman said when announcing the project.
The idea of a universal basic income has been around for awhile, but rose to prominence as the center of Andrew Yang’s 2016 presidential campaign. Other significant figures in the tech industry have since voiced support for some kind of basic income, including Twitter cofounder Jack Dorsey and Tesla CEO Elon Musk. AI godfather Geoffrey Hinton recently advised the British government to adopt a universal basic income to mitigate the number of “mundane jobs” AI is set to replace.
A universal basic income would provide all people with direct cash payments, no strings attached. That’s a hefty political lift, however. So many cities and states have experimented with guaranteed basic incomes instead. These programs provide cash payments without restrictions to select low-income or vulnerable populations. Altman’s study falls into this camp as well.
Data from dozens of these smaller programs have found that cash payments can help alleviate homelessness, unemployment, and food insecurity — though results still stress the need for local and state governments to invest in social services and housing infrastructure.
Earlier this year, Altman also floated another kind of basic income plan, which he called a “universal basic compute.” In this scenario, Altman said people would get a “slice” of the computational resources of large language model GPT-7, which they could use however they like.
“You own part of the productivity,” he explained on a podcast.
Even these smaller experiments, however, have faced political hurdles. Conservatives in several states have challenged the programs, halting their progress.
The Altman study’s findings
In its results, Altman’s study assessed both quantitative data, such as surveys and bank transactions, and qualitative data, such as interviews with recipients.
The study found that compared to the control group, recipients’ total individual savings in their bank accounts increased by nearly 25%. Recipients also spent $22 more a month on other people, or about 26% more than the control group. There was little impact on car or home ownership, though recipients of the $1,000 were more likely to move neighborhoods or pay for housing than the control group.
Regarding healthcare, recipients saw slight increases compared to the control group in dental care, emergency room visits, and healthcare spending — though there was no direct evidence of improved health.
Recipients were more likely to want to have a budget and advance their education, specifically in the third year, compared to the control group. However, there were no significant effects on educational attainment overall.
The study, which began during the COVID-19 pandemic when unemployment was high, found that employment rates fell in the second and third years among recipients compared to the control group. On average, incomes rose significantly for all groups, though slightly higher for the control group. Incomes for recipients of the $1,000 rose from just under $30,000 to $45,710, while incomes for the control group started at a similar level but grew higher, to $50,970.
“Cash offers flexibility and may increase agency to make employment decisions that align with recipients’ individual circumstances, goals, and values,” the report’s authors said.
What the participants in Altman’s basic income study say
One recipient in the program, Sarah, is a mother of four from rural Illinois who teaches in a homeschool network and makes just enough from her job to pay for school supplies.
“I don’t really make anything off of it,” she said in a testimonial shared by OpenResearch. “Even though my husband had a pretty decent job, we didn’t have a lot of money for extras.”
The payments from the Altman program helped Sarah pay for braces for both of her children, which weren’t covered by their insurance, she said. She also used the money to finance a graduation trip for her daughter.
However, Sarah said she began “slipping into a mindset” where she was less careful with her finances because it felt like money was coming in “without having to work for it.”
“Looking back, I regret that I didn’t save more of it,” she said.
Another recipient, Cara, told the study’s researchers that she suffered from a debilitating nerve disorder that caused pain across much of her body and a loss of mobility.
While she started to receive some short-term disability payments, she said a break-in to her apartment set her back financially, and she began to sell her personal belongings.
“Feeling the loss of being able to care for yourself and desperately needing the help of others; it’s rough,” Cara said.
She said she “probably started crying” when she got the phone call saying she would be receiving $1,000 payments from the Altman program. The money helped her pay off nearly all of her debts.
“It’s almost like a miracle,” she said. “Knowing that I was able to manage that mountain of medical debt, it felt like my brain would have been in a completely different place.”
Celene, another participant, told researchers she was forced to move her family in with a friend after losing money in a business venture. She said she was living in squalid conditions.
When she received the call that she had been selected for the group receiving $1,000 a month, she was in utter disbelief.
She said the money helped her buy new clothes, shoes, and basic necessities for herself and her children. By the second month, she had landed a job and began saving.
The money helped her “not feel like a failure as a parent,” she said, and gave her the confidence to make decisions in her family’s best interests.
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