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The Finnish Welfare State and Basic Income Experiment: Background, Context, and Significance

  • Journal of the Scandinavian Society of Korea
  • Abbr : JSSK
  • 2016, (18), pp.31-72
  • Publisher : The Scandinavian Society of Korea
  • Research Area : Social Science > Area Studies > North Europe(Scandinavian)

Inchoon Kim 1

1연세대학교 동서문제연구원

Accredited

ABSTRACT

The centre-right government of Finland is launching a basic income experiment in which randomly selected 2,000 citizens on unemployment benefits will receive a monthly basic income of 560 euros from January 2017 for two years. That basic income will replace their existing unemployment benefits. The aim of the experiment is to assess whether basic income can help reduce poverty and bureaucracy, while increasing the employment rate. The Finnish basic income experiment is referred to as a step by step reform of the welfare state as citizens are entitled to a minimum level of income support that is the almost same as 560 euro basic income. However, the reform is to reduce benefits since low income families can receive multiple social benefits which is usually much more than 560 euros. Therefore, under the circumstances of austerity policy and labor shortage in certain low-wage sector, the basic income seems to be ‘conditional’ rather than ‘unconditional’ and could lead to ‘enforced’ employment. The basic income is seen as an additional element to the Finnish universal social security system. And the experiment can provide insights on whether the removal of the disincentives embedded in social security will encourage the unemployed to return to jobs or not. The results of the experiment will become a hot issue in parliamentary elections in April 2019 and the future of basic income in Finland will depend on election results and its political power relations.

Citation status

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