1,200 euros are being given away purely for science
As Deutsche Welle reports, the website for recruiting volunteers willing to participate in a unique experiment in Germany received over 20,000 applications in the very first hour of operation. This is not surprising, given the conditions of the experiment.
The 120 lucky individuals selected by the organizers will receive 1,200 euros per month for three years, tax-free and with no additional obligations. Moreover, absolutely all adult residents of Germany can participate in the experiment, regardless of income level and without any conditions regarding education or social status.
This experiment is unique in every respect. First, it is funded not from the state budget but through crowdfunding. Nearly 140,000 private donors in Germany transfer a total of 618,720 euros monthly to the account of the Berlin-based public organization Mein Grundeinkommen e.V., which coordinates the project. It was founded in 2014 and has since been collecting money that is paid out to 650 randomly selected recipients for one year.
Second, the partners include renowned scientific organizations – the German Institute for Economic Research (DIW) in Berlin, as well as the University of Cologne and the Max Planck Society (Max-Planck-Gesellschaft).
Third, the experiment is aimed not at helping socially disadvantaged groups (the unemployed and welfare recipients) but at the broadest segments of the population. Thus, the project's authors do not rule out that among the recipients of the monthly gift of 1,200 euros there may be those who do not particularly need the extra income.
This "auction of unprecedented generosity" will last three years, from 2021 to 2024, during which each of the 120 participants will receive a total of 43,200 euros "net." In return, they will need to regularly report on changes in their lives, habits, and preferences.
For example, the project's authors are interested in whether participants will spend more time on social work, or more money on charity, or simply prefer to spend more time on the couch watching TV. Additionally, hair samples will be taken from some of them to determine whether the level of the stress hormone in the body changes, and if so, how.
One of the study's coordinators, Dr. Susann Fiedler, head of a research group at the Max Planck Institute for Research on Collective Goods, sees the project's goal as moving away from traditional Western debates about human productivity and trying to find an answer to whether such payments can reduce healthcare costs or smooth out inequalities of opportunity in education, often caused by low parental income. As a psychologist, she is interested in the psychological changes brought about by increased income – whether life satisfaction increases. As criteria for evaluating the effect of the payments, she cites, among others, a reduction in the number of depressions or an increase in the number of citizens dedicating their time to charitable projects.
Similar experiments are also taking place in other European countries. In Finland, for example, as part of a two-year project (from 2016 to 2018), two thousand unemployed people received 560 euros per month, tax-free. The initial results of the experiment showed that as incomes rose, people's confidence in themselves and their future increased, as did trust in state institutions.
The study's authors consider it especially relevant in the context of the coronavirus pandemic, which has increased not only unemployment but also the role of the state in the economy.
How does the free distribution of substantial sums to German citizens differ from socialist experiments in Eastern Europe in the 20th century? Professor Jürgen Schupp, coordinating the pilot project on behalf of DIW, answers: "Indeed, there have been many similar experiments with distributing money in the past, and even now in developing countries, experiments are being conducted to give money to those in need. The uniqueness of our project is that it is being conducted in a developed country with a high standard of living and social guarantees – that is, payments will also be received by those who do not need them. And the question we are interested in is whether increased income leads to increased social activity."
He decisively calls the notion that recipients of "free" money become "fed and lazy" a "stereotype."