Universal basic income and skill‑ biased technological change

Authors

  • José Coelho Nova School of Business and Economics

DOI:

https://doi.org/10.14195/2183-203X_51_6

Keywords:

Income inequality, skill premium, optimal taxation, universal basic income

Abstract

In the last decades, income inequality has been on the rise in the U.S. The growing skill premium suggests the pivotal role of skill‑ biased technological change (SBTC) in promoting the observed increase in inequality levels. In this context, labor income tax structures have been central to the policy debate. We have developed an overlapping generations model to perform a welfare evaluation of Universal basic income (UBI) tax structures and verify how these interact with SBTC. I find that an UBI system would have improved social welfare in 2010 when compared to the existing tax system and determine that this result is primarily motivated by SBTC.

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Published

2020-12-11

Issue

No. 51 (2020): Special Issue: Essays on Inequality, Structural Change and Optimal Taxation

Section

Articles

License

Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

Authors retain copyright and grant the journal right of first publication with the work simultaneously licensed under a Creative Commons Attribution License that allows sharing the work with recognition of authorship and initial publication in Antropologia Portuguesa journal.