Honest question - how does one prevent inflation with UBI?
If the market price of an apartment is $500, and suddenly everyone gets UBI, the landlord would raise the price as much as he can, say $1000.
People on UBI are in the same relative position as before. They still can’t get the apartment because there’s enough people who have the UBI plus something else and can pay $1000.
It could cause inflation because the money velocity would increase (if you’re a disciple of Milton Friedman). The presumption is that the money taken from rich peoples (and company’s) savings, that they’re not spending, and giving it to people who would spend it every month would increase the velocity and potentially cause inflation.
'inflation' is probably not the right term; money is created and destroyed more or less at will by the financial system as set forth by the nation's laws. UBI is not 'funded' by just turning on the printing presses and letting 'er rip.
But, yes, of course, if there is a scarce good (there isn't enough for everybody) and due to UBI now everybody can afford this scarce good, then... guess what, no they can't.
But that's economy at work, and entices the populace to work, so they can supplement their UBI and get scarce stuff they want.
Perhaps you mean that certain goods are so price elastic they will just cost whatever it needs to cost to squeeze every buck out of the lower-income populace.
That IS a risk, but I'm not sure the current common western economic model is any different; the _vast_ majority of these economies do have a minimum wage already, and the majority of the workforce... works, or otherwise enjoys an income that is somewhat close to minimum wage at least, leading to the same problems.
Seems silly to put the onus on UBI to solve problems that aren't particular to UBI, no?
Note that these problems are solvable, and UBI can actually help solve them: Due to UBI it is _much_ simpler to just pick up your stuff, and move to a place that is in the toilet, economy-wise: A backwater with extremely low housing prices, nearly free land, and no jobs. With UBI, hey, you can make a decent living because your UBI bucks go a lot farther out in these boonies, which should push said boonies up.
It also moves negotiating powers to the workforce: Instead of companies that are offering jobs have to compete with the notion of being either destitute/homeless, or having to jump through hoops to prove that you are unable to find work (which is how many western economies are set up today), the job offerers are competing with 'no job, live on basic UBI'. This should allow the workforce to for example demand that they get to work from home a lot more, opening doors to letting them live in places with cheaper housing.
And then, if the -entire nation-, from stem to stern, has rents set up to gauge those living on UBI alone or on UBI+scraps, there's something very wrong with your nation. Go make some laws.
Not sure if this is directly answering your question, but UBI doesn't mean that everyone spends money the same way. One person might put that money towards their kids' education, another towards household groceries, and another towards higher rent.
If the market price of an apartment is $500, and suddenly everyone gets UBI, the landlord would raise the price as much as he can, say $1000.
People on UBI are in the same relative position as before. They still can’t get the apartment because there’s enough people who have the UBI plus something else and can pay $1000.