Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/296691 
Year of Publication: 
2023
Series/Report no.: 
UCD Centre for Economic Research Working Paper Series No. WP23/17
Publisher: 
University College Dublin, UCD School of Economics, Dublin
Abstract: 
This paper presents a theoretical model showing how political mistrust affects people's preferences for Universal Basic Income (UBI) when its implementation involves a reduction in spending for other public services (welfare retrenchment). The model shows that individuals with lower levels of political mistrust are more likely to endorse UBI, reflecting their trust in the government's ability to manage public resources and avoid wasteful retrenchment of other public services. The model also shows that generalised mistrust - characterized by agents' expectations of their fellow citizens' misbehaviour that can reduce the government's fiscal capacity- does not significantly influence preferences for UBI when it involves a partial retrenchment of other public services. This result is driven by the agents' perception that their fellow citizens' misbehaviour would occur irrespective of the UBI implementation. The empirical analysis with 265 European regions from the European Social Survey (ESS) confirms the predictions of the model.
Subjects: 
Universal Basic Income
Generalised Trust
Political Trust
Welfare Retrenchment
JEL: 
D7
H53
I38
Document Type: 
Working Paper

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