The idea of a universal basic income (UBI) has received growing attention and support over recent years. Part of this appeal comes from shortcomings of existing social safety nets in effectively reducing inequality and poverty in many countries. It also stems from the need to anticipate and manage increased uncertainty and volatility in labor markets that may require renewed forms of income support and social insurance. The paper discussing the key defining features of a UBI and assesses UBI desirability based on three key dimensions: i) generosity, ii) coverage of low-income households, and iii) progressivity. The analysis covers 9 advanced and emerging economies, and is based on static partial equilibrium simulations that take into account available financing options and evaluate the impact on the distributional outcomes. The paper also discusses how a UBI could generate political and public support for implementing structural reforms such as energy subsidy reforms.
