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If I currently rent my apartment for ~400€/mo, why wouldn't I increase the rent to 600 or 800€/mo if the people were getting extra 1000€/mo from the government?

If I currently rent my apartment for ~400€/mo, why wouldn't I increase the rent to 600 or 800€/mo if the people were getting extra 1000€/mo from the government? Obviously the people might move out to somewhere more remote where the prices where lower, but now they would have to pay for the journey to work place and get whole new social circle and all other things that are involved with moving - expect you are moving to a smaller city/town or at least to worse neighborhood.

conanbatt 9y ago
>If I currently rent my apartment for ~400€/mo, why wouldn't I increase the rent to 600 or 800€/mo if the people were getting extra 1000€/mo from the government? Because you don't get to put the prices on it, its a market. > Obviously the people might move out to somewhere more remote where the prices where lower, but now they would have to pay for the journey to work place and get whole new social circle and all other things that are involved with moving - expect you are moving to a smaller city/town or at least to worse neighborhood. Think of which kind of recipient is willing to leave a city because of a monthly stiped of 1k. Its not people with median wages. To be able to make a judgement on how it would affect rent prices you wuold have to model how many people leave the cities and how many people go to them. If basic income is fixed, its probably going to punish being in the city (higher taxes) and prize living outside (the money gotten with a lower tax rate will be worth more). I never quite got why people think basic income would produce an inflation that would erode it: what kind of model or idea explains that? Its not taxation, its not inflation, its not supply-demand. Im honestly asking.
- nextlevelwizard 9y ago
  >Because you don't get to put the prices on it, its a market. Except I literally can dictate the price as I see fit. Currently my 400 is slightly below of others because I don't want to deal with getting new tenants every year. You are now assuming that other people wouldn't raise the rents for "free" money - which frankly is just naive on your part. Rest of your comment is just as nonsensical. There is no need to "model" anything. This is as simple as economics gets. People have more money to spend, so they are willing to pay more for the same stuff. My point with the moving is that people would not be doing it in general, which means they have to adapt to higher rent prices, which in turn means more money for landlords.
  - conanbatt 9y ago
    > Except I literally can dictate the price as I see fit. Currently my 400 is slightly below of others because I don't want to deal with getting new tenants every year. You are now assuming that other people wouldn't raise the rents for "free" money - which frankly is just naive on your part. If you can set prices as you see fit, you don't need to wait for basic income to do anything, just raise your prices to the max today... > This is as simple as economics gets. But..it isnt. Inflation is a monetary phenomena, not a subsidy consequence: food stamps don't make food (significantly) more expensive, even though they increase food demand! There is no way to know how will people migrate in response to a basic income, but the economists I talked to would expect people to move out of cities: again, a basic income through taxation would literally lower income of cities and increase income in rural, so you would expect people to behave accordingly.

conanbatt 9y ago

>If I currently rent my apartment for ~400€/mo, why wouldn't I increase the rent to 600 or 800€/mo if the people were getting extra 1000€/mo from the government? Because you don't get to put the prices on it, its a market. > Obviously the people might move out to somewhere more remote where the prices where lower, but now they would have to pay for the journey to work place and get whole new social circle and all other things that are involved with moving - expect you are moving to a smaller city/town or at least to worse neighborhood. Think of which kind of recipient is willing to leave a city because of a monthly stiped of 1k. Its not people with median wages. To be able to make a judgement on how it would affect rent prices you wuold have to model how many people leave the cities and how many people go to them. If basic income is fixed, its probably going to punish being in the city (higher taxes) and prize living outside (the money gotten with a lower tax rate will be worth more). I never quite got why people think basic income would produce an inflation that would erode it: what kind of model or idea explains that? Its not taxation, its not inflation, its not supply-demand. Im honestly asking.

nextlevelwizard 9y ago
>Because you don't get to put the prices on it, its a market. Except I literally can dictate the price as I see fit. Currently my 400 is slightly below of others because I don't want to deal with getting new tenants every year. You are now assuming that other people wouldn't raise the rents for "free" money - which frankly is just naive on your part. Rest of your comment is just as nonsensical. There is no need to "model" anything. This is as simple as economics gets. People have more money to spend, so they are willing to pay more for the same stuff. My point with the moving is that people would not be doing it in general, which means they have to adapt to higher rent prices, which in turn means more money for landlords.
- conanbatt 9y ago
  > Except I literally can dictate the price as I see fit. Currently my 400 is slightly below of others because I don't want to deal with getting new tenants every year. You are now assuming that other people wouldn't raise the rents for "free" money - which frankly is just naive on your part. If you can set prices as you see fit, you don't need to wait for basic income to do anything, just raise your prices to the max today... > This is as simple as economics gets. But..it isnt. Inflation is a monetary phenomena, not a subsidy consequence: food stamps don't make food (significantly) more expensive, even though they increase food demand! There is no way to know how will people migrate in response to a basic income, but the economists I talked to would expect people to move out of cities: again, a basic income through taxation would literally lower income of cities and increase income in rural, so you would expect people to behave accordingly.