11 The Social Scientists and the Great Experiment
The Social Scientists Go to Washington
In the mid-1960s, social scientists joined the War on Poverty, using new technology and methods to help solve real social issues. With computers, they could examine complicated questions that involved many factors, something they couldn't easily do before. However, using these advanced techniques, like regression analysis, was difficult and led to some mistakes that affected government decisions. Despite these problems, social scientists learned from their errors and worked together with policymakers to provide strong evidence for their programs against criticism.
The Negative Income Tax Experiment
The Negative Income Tax (NIT) experiment was a large study started in 1968 to see if giving people a guaranteed income could help reduce poverty without making them less motivated to work. This experiment was run by the Office of Economic Opportunity (OEO) and lasted ten years with about 8,700 participants. The goal was to gather solid proof about how a negative income tax, which provides payments to people earning below a certain amount, would affect their work behavior.
At first, the idea of a negative income tax came from conservative economists who wanted to replace the welfare system because they believed welfare payments discouraged people from working. However, by the time the experiment began, supporters wanted to focus on solving poverty directly, believing that guaranteed income would help people avoid relying on welfare and still encourage them to work.
In the experiment, low-income individuals were divided into two groups: one that received the payments (the experimental group) and another that did not (the control group). The amount of money given varied to test how it affected their choices. The experiment was carried out in different locations, including cities and rural areas, over a decade, producing a lot of research findings.
The results showed that a negative income tax did reduce work effort among participants. Men in the experimental group worked about 9% fewer hours, and women worked around 20% fewer hours. Many people, especially wives and young men who were not heads of families, stopped working altogether.
The study also found that the negative income tax had a negative impact on families. For example, the rates of marriage breakdown increased among those receiving NIT payments compared to those who did not. The rates were 36% higher for white families and 42% higher for black families receiving the payments.
Additionally, the findings might have downplayed how severe the negative effects were. Participants were not compared to a completely unexposed group but to others receiving welfare benefits. Since the NIT payments lasted only three years, it likely influenced people's decisions to work, with longer payment periods leading to more significant negative effects.
Overall, the NIT experiment showed that giving people a guaranteed income did not achieve the expected goals of reducing poverty and promoting work. Instead, it highlighted problems such as reduced work effort and increased family instability, showing a strong connection between the NIT and these negative outcomes.
The Social Scientists Go to Washington
In the mid-1960s, social scientists joined the War on Poverty, using new technology and methods to help solve real social issues. With computers, they could examine complicated questions that involved many factors, something they couldn't easily do before. However, using these advanced techniques, like regression analysis, was difficult and led to some mistakes that affected government decisions. Despite these problems, social scientists learned from their errors and worked together with policymakers to provide strong evidence for their programs against criticism.
The Negative Income Tax Experiment
The Negative Income Tax (NIT) experiment was a large study started in 1968 to see if giving people a guaranteed income could help reduce poverty without making them less motivated to work. This experiment was run by the Office of Economic Opportunity (OEO) and lasted ten years with about 8,700 participants. The goal was to gather solid proof about how a negative income tax, which provides payments to people earning below a certain amount, would affect their work behavior.
At first, the idea of a negative income tax came from conservative economists who wanted to replace the welfare system because they believed welfare payments discouraged people from working. However, by the time the experiment began, supporters wanted to focus on solving poverty directly, believing that guaranteed income would help people avoid relying on welfare and still encourage them to work.
In the experiment, low-income individuals were divided into two groups: one that received the payments (the experimental group) and another that did not (the control group). The amount of money given varied to test how it affected their choices. The experiment was carried out in different locations, including cities and rural areas, over a decade, producing a lot of research findings.
The results showed that a negative income tax did reduce work effort among participants. Men in the experimental group worked about 9% fewer hours, and women worked around 20% fewer hours. Many people, especially wives and young men who were not heads of families, stopped working altogether.
The study also found that the negative income tax had a negative impact on families. For example, the rates of marriage breakdown increased among those receiving NIT payments compared to those who did not. The rates were 36% higher for white families and 42% higher for black families receiving the payments.
Additionally, the findings might have downplayed how severe the negative effects were. Participants were not compared to a completely unexposed group but to others receiving welfare benefits. Since the NIT payments lasted only three years, it likely influenced people's decisions to work, with longer payment periods leading to more significant negative effects.
Overall, the NIT experiment showed that giving people a guaranteed income did not achieve the expected goals of reducing poverty and promoting work. Instead, it highlighted problems such as reduced work effort and increased family instability, showing a strong connection between the NIT and these negative outcomes.