$1000/month for all? New OpenAI study reveals shocks

In partnership with

Aloha friends,

We offer a free "AI Maturity Index (AIMI)" assessment to qualified teams. If selected, your team will receive an in-depth analysis of its AI readiness, helping you understand where you stand and where you can go.

🤖 What's in it for you?

• A comprehensive evaluation of your team’s AI capabilities

• Personalized recommendations for AI integration

• Benchmarking against industry standards

• A roadmap for future AI initiatives

📅 The catch? We need your team to complete user interviews by August 25th, 2024. It's a small time investment for a big payoff in understanding your AI journey.

👈️ Next steps?

1. Vote in the poll above.

2. Complete the AIMI assessment as an individual (you will be redirected there after voting).

3. If approved, you will get a dedicated “team link”.

4. Get your team assessment results in September.

ARE YOU IN? 🙂 

Learn AI Strategies worth a Million Dollar in this 3 hour AI Workshop. Join now for $0

Everyone tells you to learn AI but no one tells you where.

We have partnered with GrowthSchool to bring this ChatGTP & AI Workshop to our readers. It is usually $199, but free for you because you are our loyal readers 🎁

Register here for free – valid for next 24 hours only!

This workshop has been taken by 1 Million people across the globe, who have been able to:

• Build business that make $10,000 by just using AI tools

• Make quick & smarter decisions using AI-led data insights

• Write emails, content & more in seconds using AI

• Solve complex problems, research 10x faster & save 16 hours every week

You’ll wish you knew about this FREE AI Training sooner (Btw, it’s rated at 9.8/10 ⭐)

Save your seat for $0 now! (Valid for 100 people only)

The $1,000 Experiment: What OpenAI's Universal Basic Income Study Really Tells Us

This week, I had brunch with a friend who works at OpenAI. We discussed the latest results from their Universal Basic Income (UBI) experiment, and the findings were quite different from what we both had assumed in our previous conversations about UBI. It inspired me to share these insights with you.

✍️ TLDR

The OpenAI-backed UBI study reveals surprising results that challenge our assumptions about unconditional cash transfers. While recipients spent more on essentials, there were minimal improvements in health outcomes and a slight decrease in work hours. Does this experiment signal the end of our dreams of UBI as a solution to AI-driven job displacement? Or does it reveal more complex dynamics that require further exploration?

🌍️ OVERVIEW OF THE STUDY

The study, conducted by OpenResearch and backed by OpenAI's Sam Altman, was the largest randomized UBI experiment in the US to date. It ran from November 2020 through October 2023, giving 1,000 recipients $1,000 per month with no strings attached. The control group of 2,000 people received $50 monthly. Participants were aged 21-40, living in Texas and Illinois, with 2019 household incomes below 300% of the federal poverty line.

🧠 INSIGHTS

1. Spending increase: Recipients spent an average of $310 more per month, primarily on housing, food, and car expenses.

2. Work impact: Labor market participation declined by 2%, translating to working about 1.3 hours less per week or roughly 8 fewer days of work per year.

3. Income effect: Despite the $1,000 monthly transfer, recipients' overall incomes fell by about $125 per month (excluding the transfer), largely due to reduced work hours.

4. Health outcomes: The study found "essentially no evidence of improvements in physical health due to the transfers," despite collecting detailed data including blood samples and nutritional intake.

5. Mental health: There were short-lived improvements in mental health, mostly through stress reduction, but these faded by the end of the first year.

6. Food security: Recipients showed a major increase in food security during the first year, which also faded by the second year.

7. Healthcare utilization: Recipients increased their healthcare utilization, visiting hospitals, doctors, and dentists more often, and spent about $20 more per month on medical care.

8. Demographic effects: The employment effects were concentrated among young, single parents, suggesting different impacts across various demographic groups.

9. Time allocation: Recipients traded in $125 of income for about 5.5 more hours of leisure time per month, indicating a preference for increased non-work time when given the opportunity.

10. Subjective experiences: Participants reported positive experiences, including reduced stress and increased ability to plan for the future, despite some effects not being captured in the quantitative data.

💣️ CONCLUSIONS

The study presents a nuanced picture of UBI's potential impacts. On the positive side, it provided recipients with more flexibility to address their specific needs, increased healthcare utilization, and allowed for more leisure time - all of which could be valuable in an AI-driven future. The slight decrease in work hours could be seen as a positive adaptation to increased AI capabilities.

However, the study also revealed limitations of UBI. The lack of significant improvements in physical health, the temporary nature of some benefits, and the overall income reduction raise questions about its effectiveness as a long-term solution to AI-driven job displacement.

As we consider the future of work and the potential impacts of AI, we must ask ourselves: Is UBI the right tool to address these challenges, or do we need to explore other policy options? How can we balance the benefits of increased flexibility and leisure time with the need for sustainable income and meaningful work in an AI-augmented economy? I'm curious to hear your thoughts on these complex issues.

That’s all for this week! Hope you enjoyed it 😎 

Sending positive vibes your way,

Iwo