I see that it could help people start their own businesses since at the worst case you'll end up back on the minimum income. So that takes one element of stress out of it and you can focus on the business more.
I can see some arguments against this that would say the owner would be less hungry for success, and while that's true not every business that starts needs to be the next big thing.
In practise, this is more or less the case already in the nordics. The social safety net is so wide that even if you fail spectacularly at life, you won't hit rock bottom.
Except if you do badly at business, you have to lose everything before they help you. If you have anything that can be turned into money, or your spouse does, you have to use that first.
Another facet of the Nordic system, and not great for entrepreneurs.
I can see some arguments against this that would say the owner would be less hungry for success, and while that's true not every business that starts needs to be the next big thing.