Evaluation of Universal Basic Income as a Viable Policy Response to AI-Induced Technological Unemployment in the US Labor Market
DOI:
https://doi.org/10.61173/ihcs10922Keywords:
Universal Basic Income (UBI), Artificial Intelligence, Technological Unemployment, U.S. Labor Market, Fiscal FeasibilityAbstract
This study discusses whether Universal Basic Income (UBI) can serve as an effective policy to address structural unemployment caused by the widespread adoption of AI in the U.S. labor market. Unlike previous technological advances, generative AI threatens cognitive and middle-class professional roles, exposing many loopholes in traditional welfare systems of the old era. This article will analyze secondary data from four different pilot projects (Stockton SEED, Alaska Permanent Fund dividends, Finland's Basic Income Experiment, and Kenya's GiveDirectly) and combine macroeconomic models to make policy comparisons. The study mainly examines three intrinsic dimensions: labor market incentives, psychological resilience for retraining, and financial feasibility. The results show that UBI does not reduce labor force participation rates. On the contrary, it can serve as an important social stabilizer, improving mental health and providing the cognitive bandwidth needed for retraining. However, macroeconomic estimates show that implementing a nationwide UBI in the U.S. would face extremely severe fiscal constraints, with annual costs reaching $3 trillion. The findings suggest that although UBI is generally not feasible for government finances in the short term, targeted basic income is a practical and vital policy tool that can ensure income security during AI-driven economic transformation.
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