Can Guaranteed Income Keep Up with the Cost of Living: Evidence from New York City

• In Event: Housing Stability and Financial Well-Being

Abstract

Guaranteed income programs promise to increase financial stability, yet cost-of-living differences may shape their real impact. This study examines how rental market variation shapes spending patterns among recipients of a guaranteed income program in New York City. While cash transfer programs are often designed as uniform interventions, local economic conditions such as housing costs may influence how recipients allocate their funds. Using transaction-level data from recipients in Creatives Rebuild New York (CRNY), a guaranteed income program for artists in NYC, we link spending behavior with zipcode-level Zillow rental indices to assess whether recipients in higher-cost areas exhibit systematically different spending responses. Preliminary findings suggest that rental costs moderate spending decisions, with notable variation across spending categories. In higher-rent zip codes, recipients appear to allocate funds differently than those in lower-rent areas, suggesting cost-of-living pressures mediate the effectiveness of guaranteed income programs. These findings raise important questions about the design of guaranteed income programs. Can uniform cash transfers fully address financial instability in high-cost cities? By integrating spending data with neighborhood-level economic indicators, this research highlights the role of place-based economic pressures in shaping the effectiveness of direct cash assistance policies.

Author

• Lanjun Peng, Arizona State University
  Presenting Author