overall, McDonald's is probably not a good example of the sort of inflation that might occur under UBI. the supply of McDonald's meals is not really constrained

overall, McDonald's is probably not a good example of the sort of inflation that might occur under UBI. the supply of McDonald's meals is not really constrained. they can basically make as much food as people will buy, so the mere fact that people can afford more happy meals probably doesn't move the price. stuff like housing tends to be a lot more constrained, so you would expect rent/mortgages to go up roughly in proportion to how much extra money people have to bid them up. now a large part of why McDonald's can sell you a meal for $4 is that they can pay people through the whole supply chain very little money to do mostly undesirable work. if you start just giving these people money, they might be less willing to do these jobs for the same pay. so McDonald's would either have to pay them more or invest in more automation. either way, some of the cost increase gets passed on to the consumer. the works get paid more, which is cool, but they also probably see the cost of most goods and services rise as well, which is less cool. to be clear, I'm not actually arguing this is what would happen. I'm just explaining the naive econ 101 perspective on why UBI would cause inflation. even if it did cause inflation, it would still probably decrease inequality more efficiently than the current byzantine web of welfare, as long as it was funded by some sort of progressive tax(es).