Mongolia Has Universal Basic Income

Daniel Michael Hurt

April 25, 2023

Daniel Michael Hurt: The Cloud Consultant

A universal basic income (UBI) is an unconditional cash payment from the government to all citizens. It is not based on income or assets and is aimed at decreasing poverty and increasing financial security without the need for too much bureaucratic intervention.

UBI has been proposed as a solution to many problems, including the effects of job loss, wage stagnation, and social discrimination. However, there are still a lot of questions about how effective UBI is at fighting poverty.


The concept of a basic income, where everyone receives a modest sum of money regardless of their employment status, has picked up steam. It’s a policy that reformers and futurists alike embrace because it could do away with poverty, reduce inequality, sweep away patronizing bureaucracy, neutralize the threat of mass unemployment and increase the value society places on worthwhile pursuits.

Despite common objections that giving people free cash will disincentivize them from working, a nationwide universal cash-transfer program in Iran has shown no evidence to support those claims. A report published by economists Djavad Salehi-Isfahani and Mohammad H. Mostafavi-Dehzooei finds that recipients did not become work-shy, and some worked more.

The scheme started in 2011 when Iran rolled out a nationwide cash-transfer policy to compensate for heavy cuts to subsidies on bread, water, electricity, heating and fuel. Each household received a monthly payment of about 29 percent of the median income. Which amounts to about $1.50 extra per day.


Mongolia is an East Asian country between Russia and China, and it has a mineral-rich economy. Its export-driven economy relies heavily on minerals, which are worth 90% of the country’s GDP.

In 2004, the Mongolian government started to experiment with a universal resource-financed payment for children. In 2010, this was replaced by the Human Development Fund (HDF). Which was financed from mining dividends to provide monthly cash transfers to every citizen between 2010 and 2012.

This experience provided a unique perspective on public ownership and revenue sharing in the mineral sector, as citizens got direct and equal shares of their country’s wealth as co-owners. However, the HDF expenditure vastly exceeded mining revenues and eventually led to a deficit in the fund.


A universal basic income (UBI) is a social protection scheme that pays all citizens an unconditional monthly sum. No matter what their earnings or job status. It has gained popularity worldwide as a way of ending poverty while also insulating workers against the threat of automation.

India already has a wide variety of welfare schemes, ranging from free rice to an allowance to build houses for poor families. However, they are often inefficient and plagued by corruption and leakages.

Several experiments in India have shown that unconditional cash transfers to the poor have positive effects on nutrition, debt, asset building and many other livelihood measures.

But implementing a UBI would require substantial improvements to the current welfare infrastructure. It could be complicated by the need to implement and monitor benefits. Moreover, it is expected to be costly.

A recent survey in India found that a scheme of this scale could cost up to Rs15.6 trillion per year, a huge burden on the state’s finances. It would also involve a lot of administrative labor and require a lot of technological and infrastructure development.

United States

UBI is a universal cash payment given to all members of the community on a regular basis. Regardless of employment status or income level. It is designed to be individual, unconditional, universal and frequent, challenging current practices by being delivered in cash.

Many Americans have renewed interest in universal basic income recently due to fears that automation and artificial intelligence. Will displace workers at an unprecedented rate. The idea is that a program like this would ease the transition for those at risk. Stabilize incomes across the board and encourage residents to pursue retraining and alternative forms of work.

Many local governments have launched guaranteed-income pilots in recent years. Those programs offer a high degree of stability for recipients, but they are also rife with challenges. Cook County in Illinois, for example, is currently the largest of these programs.