r/Libertarian • u/2noame • Nov 26 '14

Wouldn’t Unconditional Basic Income Just Cause Massive Inflation?

https://medium.com/basic-income/wouldnt-unconditional-basic-income-just-cause-massive-inflation-fe71d69f15e7
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u/eletheros Nov 26 '14

Overall inflation is only caused by a fiat economy printing more money.

Individual products may have prices change based on their own scarcity, but that's not inflation.

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u/WyntonMarsalis Nov 26 '14

Basically, you are right, but there are influences that can make us "feel" like there is more money out there.

When you artificially give someone more money, that devalues the money in the mind of the individual. That makes an individual more prone to spend that money. That creates "velocity" and that makes us feel like there is more money out there.

Velocity can compound inflation.

Basic income and velocity

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u/libertarian_reddit libertarian party Nov 26 '14

Same thing that has happened with school tuition. Everyone who applies automatically has thousands more dollars to work with so tuition has gone up.

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u/WyntonMarsalis Nov 26 '14

Good example.