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Inflation would depend on the way labor responds. If folks continue to work the same number of hours, inflation is likely. But what if folks use the extra $1000
by rymohr 8y ago
Inflation would depend on the way labor responds. If folks continue to work the same number of hours, inflation is likely. But what if folks use the extra $1000/month to justify spending more time on non-income producing activities?
- nybble41 8y agoIf people decide to work less then you have even more price inflation. Not only are you increasing effective demand by injecting more money, you're also decreasing the supply. The only way prices stay the same, or decrease, is if productivity increases in line with the extra income.
- rymohr 8y agoAssuming output is tied to hours. As we move away from industrial employment I'd expect that relationship to weaken.