What the Largest Basic Income Study in American History Found

November 25, 2025

The OpenResearch Unconditional Cash Study — the largest randomized controlled trial of unconditional cash transfers in American history — released three years of data in 2024.¹ The study offers the most rigorous evidence to date on what happens when you give low-income Americans money with no strings attached.

The Study Design

Between November 2020 and October 2023, researchers gave 1,000 low-income adults in Texas and Illinois $1,000 per month with no conditions. Another 2,000 participants received $50 per month as a control group. Researchers tracked employment, spending, health, parenting, and credit outcomes using both surveys and administrative data.¹

Why give the control group $50 instead of nothing? Co-author David Broockman explained the methodological reasoning: “Differential attrition is a big threat to RCTs. Suppose controls were paid nothing. They’d probably respond less to our surveys in the future than those getting $1k/mo, making responders in treatment & control incomparable.”² The $50 payment kept control participants engaged — the study achieved a 96% survey response rate. The team also worked with the Illinois legislature to pass a law exempting study income from government benefit eligibility calculations, ensuring participants wouldn’t lose Medicaid or food assistance.²

The $36 million study used pre-registered analysis plans and administrative data verification. The research team published four separate working papers through the National Bureau of Economic Research, each examining different outcomes.

The Research Papers

Employment effects. The first paper examined labor market outcomes across the three-year period.³ Recipients worked about 1.3 fewer hours per week on average—roughly 8 fewer days per year. Labor force participation dropped by 2 percentage points. However, recipients were 10% more likely to be actively job searching and 9% more likely to have applied for a job than control participants. The researchers concluded that recipients weren’t working less because they valued work less, but because the cash gave them more ability to be selective about employment. It’s worth noting that some employment effects were statistically significant only before adjusting for multiple comparisons, and individual income effects were only significant at the 10% level — suggesting the findings should be interpreted with some caution.

Spending and finances. The second paper tracked consumption and household balance sheets.⁴ Recipients increased spending by an average of $310 per month, primarily on food, rent, and transportation. Credit scores improved and self-reported financial stress declined. Recipients were more likely to move to different housing, often to better neighborhoods or closer to jobs and childcare. The marginal propensity to consume was between 0.44 and 0.55 for non-durables, meaning roughly half of every dollar went directly into consumption rather than savings.

Health outcomes. The third paper examined physical and mental health.⁵ Recipients spent about $20 more per month on medical care, with increases in dental visits and specialist care. However, three years of payments produced no measurable improvements in physical health outcomes. Mental health improved in the first year but the effect faded over time. The researchers noted that increased healthcare utilization might lead to long-term health benefits, but such benefits weren’t observable within the study period. This is a notable limitation: $36,000 in cash transfers over three years didn’t translate into better health.

Parenting and children. The fourth paper examined outcomes for parents and their children.⁶ Parents who received cash spent more on their children and reported improvements in parenting behaviors, including more supervision and engagement. Recipients were more likely to enroll children in higher-quality childcare. The lowest-income parents showed the largest improvements in these self-reported measures. However, children’s academic and behavioral outcomes showed no measurable improvement over the three-year study period. The researchers suggest that poverty’s effects accumulate over lifetimes and may take longer to reverse than the study could measure — but this remains speculation rather than demonstrated effect.

What the Study Doesn’t Show

The study has important limitations worth acknowledging. First, the control group received $50/month, not zero — so the comparison isn’t between cash and nothing. Second, the study ran during an unusual economic period that included pandemic disruptions and stimulus payments. Third, $1,000/month was substantial but still left most recipients below the poverty line. Fourth, three years may not be long enough to observe effects on health or children’s outcomes—but it also may simply be that such effects don’t materialize.

The lack of health improvements is particularly notable. Cash transfer advocates often argue that poverty causes poor health through stress, inadequate nutrition, and deferred care. This study provided substantial resources over multiple years and found increased healthcare utilization but no health improvement. Either the causal pathway is weaker than assumed, the timeframe was too short, or the American healthcare system is so dysfunctional that more money for care doesn’t translate to better health.

Policy Implications

I support two UBI proposals currently before Congress: Rep. Rashida Tlaib’s BOOST Act and Rep. Bonnie Watson Coleman’s Guaranteed Income Pilot Program Act. The OpenResearch findings are relevant to both.

The BOOST Act would provide $250 per month to every American adult aged 19-67, funded by a 2.5% tax on income above $30,000 for single filers or $60,000 for joint filers. At one-quarter the amount tested in the OpenResearch study, the employment effects would likely be even smaller than the modest 1.3 hours per week reduction observed. The study suggests work disincentives at this level are minimal.

Rep. Watson Coleman’s bill would establish a three-year pilot with payments tied to local fair market rent. Given the extensive data now available from OpenResearch, Stockton, and other pilots, the marginal value of additional pilot programs is questionable. We have reasonably good evidence about short-term effects of cash transfers. What we lack is evidence about long-term effects and effects at scale—neither of which pilots can provide.

Conclusions

The OpenResearch study provides evidence that unconditional cash transfers modestly reduce work hours, substantially increase consumption of necessities, improve financial stability, and don’t produce measurable health or child outcome improvements within three years. Recipients became more selective about employment, which could be interpreted as either gaining leverage or becoming less willing to work—the data supports both framings.

It’s worth noting who funded this research. OpenResearch was founded by Sam Altman when he led Y Combinator and was later renamed when he moved to OpenAI; Altman remains chair of the organization.⁷ The CEO of the company most responsible for AI-driven labor displacement is also the primary funder of research making the case that UBI can cushion that displacement. This research helps shift responsibility for AI’s labor market consequences from the companies building the technology to the federal government and taxpayers.

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