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by ethanbond 932 days ago
In ways that… mitigate rent increases? Say more what specific effect is relevant to this.
1 comments

Well, you have the UBI increasing incomes at the lower end of the economy, which does apply upward pressure on lower-cost rents. But on the other side, you'd be decreasing the income/wealth at the top, which applies downward pressure at the high end of the market. The ultimate effect is not a straightforward calculation. I think the total size of the money supply is probably the most significant factor, and that wouldn't change if the UBI is funded by taxes.
But then you’re talking about the effects of a high marginal tax rate, not UBI.
I'm talking about the effects of wealth redistribution vs. money supply expansion. Redistribution doesn't necessarily increase prices since the total amount of purchasing power in the market doesn't change. It's certainly not as simplistic as "rent gets increased in proportion to the amount of the UBI" as you're implying.
Taking into account redistribution, the story is even more bleak, not less. Lower income housing prices will rise faster than higher income housing prices.
Why? What makes prices go up given a constant money supply?
The ability to charge more? Analogous example in minimum wage increases: https://www.sciencedirect.com/science/article/abs/pii/S00941...

Evictions went down for 3 months, then rose again back to their prior levels as landlords increased rents.