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Analysis of the Effects of the Youth Basic Income Policy in Gyeonggi Province: Comparison of the Ex-Ante and Ex-Post Survey Yoo, Young Seong Et Al

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Analysis of the Effects of the Youth Basic Income Policy in Gyeonggi Province: Comparison of the Ex-Ante and Ex-Post Survey Yoo, Young Seong Et Al Gyeonggi Research Institute Policy Study 2019-73 Analysis of the Effects of the Youth Basic Income Policy in Gyeonggi Province: Comparison of the Ex-Ante and Ex-Post Survey Yoo, Young Seong et al. Gyeonggi Research Institute Gyeonggi Research Institute Policy Study 2019-73 Analysis of the Effects of the Youth Basic Income Policy in Gyeonggi Province: Comparison of the Ex-Ante and Ex-Post Survey Yoo, Young Seong et al. Gyeonggi Research Institute Preface Gyeonggi Province has been implementing the Youth Basic Income (“YBI”) policy since April 1, 2019. Under this policy, every 24-year-old person who has lived in Gyeonggi Province with resident registration for at least three consecutive years or ten years in total is paid KRW 250,000 every quarter, or up to KRW 1 million a year, in local currency. Currently, the population of Gyeonggi Province is well over 13 million, and around 175,000 youths (aged 24) are eligible for the Gyeonggi Province YBI. Unlike Alaska’s Permanent Fund Dividend (PFD), which is paid from the revenue the State generates from its oil, this project is financed by the Gyeonggi Province government, with the budget estimated at around KRW 175 billion annually. Not surprisingly, the YBI project has been attracting a great deal of attention. Questions have been raised whether the project is having the intended effect. Against this backdrop, the Gyeonggi Research Institute (GRI) conducted a study to measure the policy effects of Gyeonggi Province YBI. The group of beneficiaries was compared with a control group, and both groups were surveyed before and after the implementation of the YBI project to enable comparison between the ex-ante and ex-post survey results. The results of the study showed that the YBI project has had satisfying effects in various aspects, providing a foundation on which Gyeonggi Province will be able to pursue basic income projects with more confidence. I hope that the Gyeonggi YBI project will succeed and give hope to the young people in Gyeonggi Province. I would like to express my gratitude to Dr. YoungSeong Yoo, Head of the Basic Income Research Group, and other researchers for their hard work and valuable contributions toward achieving this goal. Dec, 2019. President of Gyeonggi Research Institute Hanjoo Lee 5 Abstract Analysis of the Policy Effects of Youth Basic Income in Gyeonggi Province : Comparison of Ex-Ante and Ex-Post Surve Gyeonggi Province has been implementing the Youth Basic Income (“YBI”) policy since April 1, 2019. Under this policy, every 24-year-old who has lived in Gyeonggi Province with resident registration for at least three consecutive years or ten years in total is paid KRW 250,000 every quarter, or up to KRW 1 million a year, in local currency. Around 175,000 youths are eligible for the Gyeonggi Province YBI. Out of the qualified recipients, 124,335 filed for the benefits in 1Q (including those who filed for the 1Q payment in 2Q). These applicants were the subjects of this study. To analyze the policy effects of the Gyeonggi Province YBI, we needed to compare the survey results with a comparison group of youths aged 24 residing across South Korea, outside Gyeonggi Province. The survey methods were both quantitative and qualitative. For the quantitative study, structured questionnaires were distributed to the subjects. The same questions were included in the ex-ante and ex-post surveys, barring adjustments to account for the time difference, so that a panel data set could be created. Simultaneously, the same quantitative study was designed to also be conducted among the comparison group, consisting of 24-year-olds residing in regions other than Gyeonggi Province. The experimental group comprised 63,300 youths (aged 24) who applied for the YBI and participated in the ex-ante survey. Of the participants in the ex- 6 ante survey, a total of 32,687 youths also responded to the ex-post survey. Therefore, it was possible to establish panel data based on the responses of the 32,687 respondents. As for the comparison group, the ex-ante survey obtained 1,300 responses, of which 900 respondents participated in the ex- post survey. Thus, the panel data of the comparison group consisted of 900 responses. However, the qualitative study was conducted only for the experimental group—24-year-olds residing in Gyeonggi Province—because it was deemed unnecessary for the comparison group, who had been unaffected by the program. For the qualitative study, the subjects were divided into six groups of about five participants each and asked to participate in discussions. The study used a “semi-structured” focus group interview (FGI) method, where the interviewer is allowed some discretion, albeit with a pre-determined set of questions. The interviewees were selected by a specialized research agency; among the people who were randomly selected based on several criteria, those who agreed to participate were finally chosen for the FGIs. The selection criteria examined whether they are employed, students, or graduates; what their level of formal education is; and whether they have prior experience receiving public assistance. In addition, for balanced regional representation, the subjects were selected evenly from five districts in Gyeonggi Province: Gyeongbu, Gyeongwon, Gyeongui, Dongbu, and West Coast districts. The six FGI groups were composed as follows: ① employed with high school education or below (4 persons), ② employed with a college degree or above (7 persons), ③ unemployed with high school education or below (5 persons), ④ unemployed with a college degree or above (6 persons), ⑤ 7 university students (including those in leave of absence) (6 persons), and ⑥ former recipients of public assistance (6 persons).The results of the survey analysis are as follows: First, the following five categories were analyzed for the quantitative study: happiness, health and diet, perception and attitude, economic activity, and dream capital. The differences in the individual variables within each category between the experimental group and the comparison group were analyzed using the paired t-test and independent two-sample t-test (under the assumption of homoscedasticity after Levene's test). According to the findings, on the whole, the Gyeonggi Province YBI policy has had positive effects, including the following: ① There were substantial improvements in the overall satisfaction with life, perception of work values, and level of happiness among youths in Gyeonggi Province. ② There was a positive impact on the perception and attitude of youths in Gyeonggi Province. ③ There was a positive impact on the beneficiaries’ general perception about welfare and basic income. ④ Youth perception and attitude toward basic income also changed positively. ⑤ The subjects were positive about the nationwide expansion of basic income for youths but were reserved about the expansion of basic income to the general population. ⑥ There was a positive impact on the recipients’ motivation to work. ⑦ The overall level of dream capital was high among youths in Gyeonggi Province. 8 Second, as part of the qualitative study, FGIs were conducted in four domains: experiences of receiving YBI, perceptions regarding youth basic income, youths’ understanding of life, and other. The findings can be summarized as follows: ① YBI recipients believe that there is little scope for improvement in the current Gyeonggi Province YBI policy. ② There were complaints about the limitations on the regions and the size of stores (where local currency could be used), but these restrictions are in line with the original policy goals. ③ In particular, the hassle of filing an application every quarter was raised; this has improved since the 4Q application. ④ Participants considered it premature to expand the basic income program to the general population, even within just Gyeonggi Province. ⑤ The majority of the participants do not seem to fully understand the meaning of basic income or are still inclined to prefer selective welfare, which is currently the prevalent method in Korean society. These results point to the need to raise awareness of basic income policies among the public. In conclusion, it can be said that the Gyeonggi Province YBI has influenced youth recipients positively in various ways. The subjects also reacted favorably to the local currency. Although there were some areas that scored worse in the ex-post survey than the ex-ante survey or did not show more positive effects than the comparison group, the vast majority of these differences was not statistically significant. Keyword Youth Basic Income, Gyeonggi Province, Policy Evaluation. 9 Analysis of the Effects of the Youth Basic Income Policy in Gyeonggi Province Contents Chapter 1 Introduction 18 1. Background and Purpose of the Study 18 2. What is Gyeonggi Province Youth Basic Income (YBI)? 20 2-1. Main Contents of the YBI Policy 2-2. Main characteristics of the YBI Policy 3. Research Content and Methodology 26 3-1. Overview of the Survey Project 3-2. Survey Results 4. Research Framework 32 Chapter 2 Quantitative Study 36 1. Organization of Effect Measurement Items 36 1-1. Happiness 1-2. Health and Diet 1-3. Perception and Attitudes 1-4. Economic Activities 1-5. Dream-Capital 2. Analysis of Results (Statistical Verification) 48 2-1. Happiness 2-2. Health and Diet 2-3. Perception and Attitude 2-4. Economic Activities 2-5. Dream-capital 3. Sub-conclusion 120 Chapter 3 Qualitative Study 123 1. Design of the Qualitative Study 126 1-1. Introduction 1-2. Composition of the Questionnaire 2. Analysis of the Qualitative Study Results by Group 128 2-1. [Group 1] Employed with high school education or below 2-2. [Group 2] Employed with a college degree or above 2-3. [Group 3] Unemployed with high school education or below 2-4. [Group 4] Unemployed with a college degree or above 2-5. [Group 5] University Students 2-6.
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