3 ms·

> Implemented on a national scale, cost inflation of basic consumer needs is a near certainty. How so? Is there are large number of consumers that are currentl

by pg314 9y ago

> Implemented on a national scale, cost inflation of basic consumer needs is a near certainty. How so? Is there are large number of consumers that are currently not able to satisfy their current basic needs? Otherwise aggregate demand will stay the same and on the supply side nothing changed, so there is no reason why prices would change.

zanny 9y ago
Its also worth noting that inflation only happens like that when demands cannot be met. IE fixed quantity of goods that cannot grow, being demanded more and more over time. That is not how basic necessities work at all. If you increase the profit margin in almost any food crop or raw material by a few fractions of a percent you see dramatic investment in sating that demand because its an extremely safe profit center.
taysic 9y ago
Why do you think nothing would change on the supply side? There are plenty of low income workers that would quit their jobs, driving their wages up - thereby either driving up the cost of goods or reducing supply. Unless of course the goods are shipped from nonUBI countries
- pg314 9y ago
  Good point, I hadn't considered those second order effects. > There are plenty of low income workers that would quit their jobs, driving their wages up I don't think we have enough information currently to unequivocally state that. How many low income workers would quit? It's not like many people in better paying jobs reduce their working hours up to a point where they make the equivalent amount of money as a UBI. How many currently unemployed people would be picking up the slack? > thereby either driving up the cost of goods or reducing supply. Labor costs are a small part of the price of basic goods. I couldn't find much good information, but e.g. [1] says that for fresh fruit and vegetables a 40% increase of labor costs amounts to a 4% increase for consumers. [1] https://migration.ucdavis.edu/rmn/more.php?id=2005 https://migration.ucdavis.edu/rmn/more.php?id=2005
  - taysic 9y ago
    As is seen with people on welfare there are plenty of jobs they won't take if they don't have to. The meager wages don't make them worth it. Because of this I think prices would soar much higher than 40%
    - pg314 9y ago
      UBI is unconditional: you don't lose it if you work. That is not the case with welfare, typically.

by pg314 9y ago

zanny 9y ago

Its also worth noting that inflation only happens like that when demands cannot be met. IE fixed quantity of goods that cannot grow, being demanded more and more over time. That is not how basic necessities work at all. If you increase the profit margin in almost any food crop or raw material by a few fractions of a percent you see dramatic investment in sating that demand because its an extremely safe profit center.

taysic 9y ago

Why do you think nothing would change on the supply side? There are plenty of low income workers that would quit their jobs, driving their wages up - thereby either driving up the cost of goods or reducing supply. Unless of course the goods are shipped from nonUBI countries

pg314 9y ago
Good point, I hadn't considered those second order effects. > There are plenty of low income workers that would quit their jobs, driving their wages up I don't think we have enough information currently to unequivocally state that. How many low income workers would quit? It's not like many people in better paying jobs reduce their working hours up to a point where they make the equivalent amount of money as a UBI. How many currently unemployed people would be picking up the slack? > thereby either driving up the cost of goods or reducing supply. Labor costs are a small part of the price of basic goods. I couldn't find much good information, but e.g. [1] says that for fresh fruit and vegetables a 40% increase of labor costs amounts to a 4% increase for consumers. [1] https://migration.ucdavis.edu/rmn/more.php?id=2005 https://migration.ucdavis.edu/rmn/more.php?id=2005
- taysic 9y ago
  As is seen with people on welfare there are plenty of jobs they won't take if they don't have to. The meager wages don't make them worth it. Because of this I think prices would soar much higher than 40%
  - pg314 9y ago
    UBI is unconditional: you don't lose it if you work. That is not the case with welfare, typically.