4 ms·

Giving these people in isolation $1,000/month, probably no. Giving everyone $1,000/mo, you could expect that money to be captured as economic rents, if not lit

Giving these people in isolation $1,000/month, probably no. Giving everyone $1,000/mo, you could expect that money to be captured as economic rents, if not literal rents. If you currently spend $2,000/mo on your apartment, which is probably low for many areas (such as the California Bay Area), then people currently living further away to pay only $1,000/mo can now afford your $2,000/mo apartment. So the price has to go up. I say all of this as a somewhat proponent of UBI. In particular, I like the idea that UBI could replace many assistance programs, would be destigmatized, would not have the administrative overhead of those programs, would not be a welfare trap, and would be fundamentally fair. But giving it to everyone would also tend to be inflationary, and would likely be captured by rent-seekers, unless such rents are controlled somehow. But rent controls are also distorting. It's all very theoretically problematic, and a small scale study just can't be predictive of the distortionary effects that full scale UBI would have.

ethbr1 2y ago
The quintessential example is US college tuition. The US government shoveled free / low-cost money into sending people to college, university tuitions increased to capture that additional funding while still keeping their enrollment numbers. Let's not do that with housing?
- mgh95 2y ago
  This fact is what scares me most about economic populism in the USA. I'm not concerned about higher taxes: I'm concerned people look at the college market and see the problem as lack of subsidy, not about excess capital availability.
  - ethbr1 2y ago
    The problem is that you can only subsidize a for-profit entity (including non-profits that act as such) by simultaneously controlling prices (or scaling supply supra-demand). Anything else, including any personal contribution, and the prices just raise to include the subsidy. Which is exactly what you'd expect a market rate to do! * The sole exception seems to be if the subsidies are targeted and few enough in number so as to not influence the broader market rate, but then you're not helping as many people.

ethbr1 2y ago

The quintessential example is US college tuition. The US government shoveled free / low-cost money into sending people to college, university tuitions increased to capture that additional funding while still keeping their enrollment numbers. Let's not do that with housing?

mgh95 2y ago
This fact is what scares me most about economic populism in the USA. I'm not concerned about higher taxes: I'm concerned people look at the college market and see the problem as lack of subsidy, not about excess capital availability.
- ethbr1 2y ago
  The problem is that you can only subsidize a for-profit entity (including non-profits that act as such) by simultaneously controlling prices (or scaling supply supra-demand). Anything else, including any personal contribution, and the prices just raise to include the subsidy. Which is exactly what you'd expect a market rate to do! * The sole exception seems to be if the subsidies are targeted and few enough in number so as to not influence the broader market rate, but then you're not helping as many people.