Assessing the Impact of the Implementation of Universal Basic Income on Entrepreneurship

Abstract

We focus on the literature about UBI and the experiments developed all around the world to test it in order to address how UBI implementation could affect entrepreneurship. Building on these findings and various strands of entrepreneurial theory, we develop a theoretical framework to explain how the implementation of UBI would dramatically change the environment of entrepreneurial activity, shaping entrepreneurial action at three levels: (i) the desirability of becoming an entrepreneur; (ii) the perceived feasibility of becoming an entrepreneur; (iii) the propensity to act. Consequently, UBI implementation would arguably facilitate the decision to become an entrepreneur. The contribution of the paper is threefold. It firstly provides a theoretical framework that opens new directions for further research on the relationship between UBI and entrepreneurship. Secondly, it offers new insights for policy makers by shedding light on potential effects of UBI implementation. Finally, it raises further questions that remains unsolved related to the role of non-pecuniary motivations and financial constraints.