This is a really interesting idea, but wouldn’t prices go up as a result?
Astrid Wynne
3

> This is a really interesting idea, but wouldn’t prices go up as a result?

Yep. Absolutely they would. And the higher the Basic Income, the greater the incentive to spend; the greater the incentive to spend, the higher prices will go . . . and they will rise (in the aggregate) to the point at which that additional $1,000 everyone was getting would not make them better off; then there would be political pressure to raise the level of the Basic Income . . . at which point, prices would tend to rise even more.

And no, you wouldn’t want to impose yet another regulation on economic activity like price controls. Price controls do nothing but provide a strong DIS-incentive for suppliers of goods and services to bring their wares to market, in which case you’ll start to see shortages. Current-day Venezuela is an object lesson in this: government price controls on food and other basic necessities have caused shortages in just those very things; gifting each Venezuelan a free $1,000 of guaranteed income won’t help them find goods and services that are simply no longer being offered in the market.

The Swiss recently rejected a UBI proposal in a referendum, and for a very good reason: it’s just a silly, meddlesome idea, that will cause more problems in the future.

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