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This really does not seem like a balanced take, e.g. it does not address the main question of inflation destroying whatever value might be created. If we redis

This really does not seem like a balanced take, e.g. it does not address the main question of inflation destroying whatever value might be created. If we redistribute money (which is a proxy for scarcity) to a small number of people, it is hard to observe the aggregate effect on the rest of the economy. If we redistribute money to everyone, we reduce the value (e.g. velocity of money increases without a commensurate change in economic output), so there would be massive inflation. It's possible that the continual massive inflation will cost less than the stability created by UBI, and it's possible it could be the extreme opposite. So, it would be a Grand Experiment, like Communism, and like all grand experiments it could end very poorly, and these studies do nothing to address that.

grafmax 2y ago
As long as lower economic strata gain an increased portion of the money supply, they ought to be able to purchase more than they did before, even after inflation. At a high level inflation is a function of the money supply not the money supply of the lower strata.
James_K 2y ago
It can be done on the scale of a city or region within a country. The idea it would have an inflationary effect is somewhat misguided. There are only so many goods available in the economy, and redistributing money can't decrease that. Your real wealth, that is the quantity of goods and services you have access to, will go up if you are below the mean, and down if you are above it, under a scheme of redistribution. The inflationary effect is actually a desired result, as it will increase the economic incentive to produce goods appealing to people on the lower end of the income scale. In the long term, you should expect a real terms decrease in the price of essential goods and an increase in the price of luxury goods as the spending power of the rich falls in comparison to the middle and lower classes. You can see the precise opposite of this at play currently. Rising inequality, the exact opposite of redistribution, has driven massive increases in the production of luxury goods and simultaneous inflation and decreases in the production of essential goods. TL;DR A free market serves the consumers with money, and redistributing money re-balances the market towards serving a certain group of people. I believe a downwards redistribution would be favourable to the present upwards one.

grafmax 2y ago

As long as lower economic strata gain an increased portion of the money supply, they ought to be able to purchase more than they did before, even after inflation. At a high level inflation is a function of the money supply not the money supply of the lower strata.

James_K 2y ago

It can be done on the scale of a city or region within a country. The idea it would have an inflationary effect is somewhat misguided. There are only so many goods available in the economy, and redistributing money can't decrease that. Your real wealth, that is the quantity of goods and services you have access to, will go up if you are below the mean, and down if you are above it, under a scheme of redistribution. The inflationary effect is actually a desired result, as it will increase the economic incentive to produce goods appealing to people on the lower end of the income scale. In the long term, you should expect a real terms decrease in the price of essential goods and an increase in the price of luxury goods as the spending power of the rich falls in comparison to the middle and lower classes. You can see the precise opposite of this at play currently. Rising inequality, the exact opposite of redistribution, has driven massive increases in the production of luxury goods and simultaneous inflation and decreases in the production of essential goods. TL;DR A free market serves the consumers with money, and redistributing money re-balances the market towards serving a certain group of people. I believe a downwards redistribution would be favourable to the present upwards one.