Russel Sage Foundation

The economic and social struggles of many households arise because they lack enough money to make ends meet. Living expenses are high, wages have grown slowly, and families often have high debt and low savings. Under these conditions, guaranteed income programs have been proposed to improve financial security. Basic income programs are being implemented in several cities but remain understudied. Economist Jonathan Morduch and policy analyst Ajay Chaudry propose a qualitative study of a sample of households who are participating in a randomized controlled trial of a guaranteed income experiment in Compton, CA. Participants must live in Compton, be between the ages of 23 and 57, and earn under 200 percent of the federal poverty threshold. The study includes undocumented residents and has no work requirements. Disbursements started in January 2021 and will continue through March 2023. Among eligible households, 2,000 households were randomly selected into the study, with 1,300 controls and 700 assigned to receive one of two cash benefits for 24 months. Treatment recipients are randomly assigned to receive the same total amounts, but half receive larger sums quarterly ($900 if the household has no children, $1,350 if one child, and $1,800 for two or more children), while the other half receives payments every two weeks ($150 if the household has no children, $225 if one child, and $300 for two or more children). The annual totals are thus identical – $3,600 (no children), $5,400 (1 child), $7,200 (2+ children) per year.