Basic income and full employment: Lessons from Polanyi, Keynes and Minsky

Abstract

The purpose of this paper is to analyze some of the literature on guaranteed income policies as promoted by both mainstream and heterodox economists over the last half century and to offer a critique on the basis of what can be described as a Polanyian perspective going back to Karl Polanyi’s assessment of the Speenhamland system in his celebrated 1944 book, The great transformation, while supporting the principle of universal basic income as a means to re-embed the capitalistic labor market so as to better meet the needs of the whole community, it is argued that a guaranteed income policy without also a societal commitment to full employment may trigger labor-market mechanisms that could prevent the societal re-embeddedness from actually occurring.