A Mathematical Model of Universal Basic Income and Its Numerical Simulations
In this paper, an elementary mathematical model describing the introduction of a universal basic income in a closed market society is constructed. The model is formulated in terms of a system of nonlinear ordinary differential equations, each of which gives account of how the number of individuals i...
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| Format: | article |
| Language: | EN |
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MDPI AG
2021
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| Subjects: | |
| Online Access: | https://doaj.org/article/087242fda8ff4598a1608d6f7b7d64d7 |
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| Summary: | In this paper, an elementary mathematical model describing the introduction of a universal basic income in a closed market society is constructed. The model is formulated in terms of a system of nonlinear ordinary differential equations, each of which gives account of how the number of individuals in a certain income class changes in time. Societies ruled by different fiscal systems (with no taxes, with taxation and redistribution, with a welfare system) are considered and the effect of the presence of a basic income in the various cases is analysed by means of numerical simulations. The main findings are that basic income effectively acts as a tool of poverty alleviation: indeed, in its presence the portion of individuals in the poorest classes and economic inequality diminish. Of course, the issue of a universal basic income in the real world is more complex and involves a variety of aspects. The goal here is simply to show how mathematical models can help in forecasting scenarios resulting from one or the other policy. |
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