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by jmesserly
4161 days ago
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I'm not an economist either, but applying textbook theory from school, it could help. A lot depends on the size, and making sure it isn't too big to discourage employment. http://en.wikipedia.org/wiki/Basic_income would be a demand side stimulus, with money going to the folks most likely to spend by taxing the folks most likely to save (you wouldn't want to do it by "printing money"). That particular effect would point in the direction of increased GDP (assuming we start from a deflationary trap with inadequate demand and large private debt overhang). However the risk would be too much employment lost, which points in the direction of decreased GDP. A safer way to do the same thing would be to just spend government money on things like building infrastructure. In current conditions, that translates into increased GDP without the reduced employment risk. Similarly reduced taxes on lower incomes would be less risky but work through the same means. (This isn't addressing whether basic income would be morally good or bad. Just the macro effects.) |
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