7 ms·

To your list of issues I'd add extraction by rentiers. My (perhaps naive) understanding is that rents tend to rise to a market equilibrium. Infuse the the aggr

To your list of issues I'd add extraction by rentiers. My (perhaps naive) understanding is that rents tend to rise to a market equilibrium. Infuse the the aggregate market in an area with X dollars, and rents will rise to consume X. I'd be curious to hear counterarguments to that point.

_rpd 8y ago
I think this is a key concern. I don't think that there is a good counterargument, but the best that I've heard is that UBI will enable mass migration to rural areas or remote exburbs (including corporate sponsored - welcome to your new Google Home!). Of course some are happy to introduce rent controls or spark an inflationary death spiral with 'cost of living' adjustments.
- mises 8y ago
  You're saying I should go live in the countryside, away from everyone? Yeah, teleconferencing is possible, but I don't know that most people would want to. It's also impractical to build public transportation that far out (you have to build increasingly more for each mile you expand from the nearest city center; distance between angles grows as you move outward), meaning that people would be driving a LOT more (higher gas prices). Or, if you by some miracle built all that transportation, it would be expensive. And people still need to "go to town" for many supplies, so just staying there isn't practical (let alone realistic for most).
  - _rpd 8y ago
    It's less 'should' than that UBI enables the possibility of reversal of the long term rural -> urban migration trend, since this trend is driven by job seekers. I don't think it will occur (the lower your income, the more you rely on geographically-based support networks) but if it doesn't, then UBI increases will be largely captured by rentiers. If it does, then urban rentiers will have to compete with non-urban rentiers, and UBI will have a chance to have the economic effect intended by proponents.
dragonwriter 8y ago
> Infuse the the aggregate market in an area with X dollars UBI (designed sanely) doesn't involve any net infusion of dollars (which would require government borrowing or printing money to distribute), it is paid for from tax revenues; it's a downstream redistribution, not an infusion.
- msluyter 8y ago
  Perhaps my wording was poor. I'm thinking of geographical regions, not the economy as a whole. Thus, despite a net zero effect globally, any redistributive effects would be unevenly allocated to various regions. And it's easy to imagine certain areas -- in particular, poorer ones -- having a higher income per capita of renters in particular. Toy example: a population of 100, with one billionaire who owns their house outright and 99 people renting apartments. Take X dollars from the billionaire, distribute it to the 99. Why would the rentier, esp. if it happened to be the billionaire, not raise rents in aggregate by X?
  - dragonwriter 8y ago
    Why don't rents consume all the economic growth without UBI? If there is, in a market (of whatever scale, and whether it's housing rental or anything else), a monopoly or coordinated oligopoly that is abused so as to absorb all income growth, that's a problem calling for government intervention independent of UBI. Maybe these exist in some housing markets, but if they do it's an orthogonal problem to UBI that is just as important to correct even if we don't adopt UBI. It's not, in any way, an argument against UBI.
    - mises 8y ago
      > Why don't rents consume all the economic growth without UBI? They sort of do (at least in some cases; see San Francisco, New York, tons of other big cities). > that is just as important to correct even if we don't adopt UBI. It's not, in any way, an argument against UBI. The fact that the we need to address it doesn't mean we easily can. And doesn't mean that just blindly doing it is justified, just because there shouldn't be such a problem.
manicdee 8y ago
Yes, the rents in popular areas will rise. Since people have a basic income to support them regardless where they are living, they can move to areas with lower rent (thus increasing the rent — and net rental income — of the area they move to). At present, most unemployment benefits systems require the recipient to stay where they are, or move to places with better employment opportunities. This places a large burden on the recipient since they might already be in a high rent area and are not allowed to move to somewhere they can afford to live.
- mises 8y ago
  I figure low-rent areas will have rents go up as well. It may take longer, but it will ripple through the whole economy.
  - manicdee 8y ago
    Yes, all rents will rise, but most rents will rise less than the rise in income until rental vacancies hit 0%.
    - mises 8y ago
      Not sure. In a normal, gradual rise in wages, this might be true. But in a massive, sudden income increase, I personally would try increasing my prices (by at least some) immediately. And more over time.

_rpd 8y ago

I think this is a key concern. I don't think that there is a good counterargument, but the best that I've heard is that UBI will enable mass migration to rural areas or remote exburbs (including corporate sponsored - welcome to your new Google Home!). Of course some are happy to introduce rent controls or spark an inflationary death spiral with 'cost of living' adjustments.

mises 8y ago
You're saying I should go live in the countryside, away from everyone? Yeah, teleconferencing is possible, but I don't know that most people would want to. It's also impractical to build public transportation that far out (you have to build increasingly more for each mile you expand from the nearest city center; distance between angles grows as you move outward), meaning that people would be driving a LOT more (higher gas prices). Or, if you by some miracle built all that transportation, it would be expensive. And people still need to "go to town" for many supplies, so just staying there isn't practical (let alone realistic for most).
- _rpd 8y ago
  It's less 'should' than that UBI enables the possibility of reversal of the long term rural -> urban migration trend, since this trend is driven by job seekers. I don't think it will occur (the lower your income, the more you rely on geographically-based support networks) but if it doesn't, then UBI increases will be largely captured by rentiers. If it does, then urban rentiers will have to compete with non-urban rentiers, and UBI will have a chance to have the economic effect intended by proponents.

dragonwriter 8y ago

> Infuse the the aggregate market in an area with X dollars UBI (designed sanely) doesn't involve any net infusion of dollars (which would require government borrowing or printing money to distribute), it is paid for from tax revenues; it's a downstream redistribution, not an infusion.

msluyter 8y ago
Perhaps my wording was poor. I'm thinking of geographical regions, not the economy as a whole. Thus, despite a net zero effect globally, any redistributive effects would be unevenly allocated to various regions. And it's easy to imagine certain areas -- in particular, poorer ones -- having a higher income per capita of renters in particular. Toy example: a population of 100, with one billionaire who owns their house outright and 99 people renting apartments. Take X dollars from the billionaire, distribute it to the 99. Why would the rentier, esp. if it happened to be the billionaire, not raise rents in aggregate by X?
- dragonwriter 8y ago
  Why don't rents consume all the economic growth without UBI? If there is, in a market (of whatever scale, and whether it's housing rental or anything else), a monopoly or coordinated oligopoly that is abused so as to absorb all income growth, that's a problem calling for government intervention independent of UBI. Maybe these exist in some housing markets, but if they do it's an orthogonal problem to UBI that is just as important to correct even if we don't adopt UBI. It's not, in any way, an argument against UBI.
  - mises 8y ago
    > Why don't rents consume all the economic growth without UBI? They sort of do (at least in some cases; see San Francisco, New York, tons of other big cities). > that is just as important to correct even if we don't adopt UBI. It's not, in any way, an argument against UBI. The fact that the we need to address it doesn't mean we easily can. And doesn't mean that just blindly doing it is justified, just because there shouldn't be such a problem.

manicdee 8y ago

Yes, the rents in popular areas will rise. Since people have a basic income to support them regardless where they are living, they can move to areas with lower rent (thus increasing the rent — and net rental income — of the area they move to). At present, most unemployment benefits systems require the recipient to stay where they are, or move to places with better employment opportunities. This places a large burden on the recipient since they might already be in a high rent area and are not allowed to move to somewhere they can afford to live.

mises 8y ago
I figure low-rent areas will have rents go up as well. It may take longer, but it will ripple through the whole economy.
- manicdee 8y ago
  Yes, all rents will rise, but most rents will rise less than the rise in income until rental vacancies hit 0%.
  - mises 8y ago
    Not sure. In a normal, gradual rise in wages, this might be true. But in a massive, sudden income increase, I personally would try increasing my prices (by at least some) immediately. And more over time.