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Well, I think advocates of UBI arguing that it would encourage growth by stimulating spending are ignoring the fact that a tax-funded UBI would take money from
by snrplfth 10y ago
Well, I think advocates of UBI arguing that it would encourage growth by stimulating spending are ignoring the fact that a tax-funded UBI would take money from elsewhere. It doesn't necessarily matter what advocates of UBI say about its suppose growth-boosting effects or what have you - the parent post was saying that Econ 101 understanding affirms that redistributive policies increase inflation, and I disagree. I should definitely qualify that with the caveat that I'm talking about Monetarist Econ 101, where V is stable in the long run, and Q is determined by overall productivity. Therefore P is roughly proportional to M. Sure, there's short-term effects, but over the long run, by Monetarist Econ 101, a UBI, if funded out of tax revenues, shouldn't cause inflation.