<story><title>Finland will hand out cash to 2000 jobless people to test universal basic income</title><url>http://www.nytimes.com/2016/12/17/business/economy/universal-basic-income-finland.html</url></story><parent_chain><item><author>austinjp</author><text>What&amp;#x27;s to stop UBI from &amp;quot;cancelling itself out&amp;quot; due to inflationary effects?&lt;p&gt;Prior to UBI, the lowest possible income is zero. After UBI, the lowest income is X. The poorest people in the nation will have an income of X, so X becomes the new relative zero, the new baseline. Prices of everything (food, housing, whatever) will reset relative to X. So uni will become worthless shortly after it&amp;#x27;s introduced.... but only if it is truly universal.&lt;p&gt;Someone feel free to tell me if I&amp;#x27;m missing something.</text></item></parent_chain><comment><author>alexbecker</author><text>This only true if there is no competition and demand for the good is completely inelastic. What stops grocery stores from doubling the price of food? The other stores will make a killing by undercutting them. I think food is pretty safe here.&lt;p&gt;I am concerned about housing though. In some places, the supply is extremely inelastic, limiting competition, and the demand is also inelastic due to the difficulty of moving. Although UBI could make moving to a cheaper area easier.</text></comment>
<story><title>Finland will hand out cash to 2000 jobless people to test universal basic income</title><url>http://www.nytimes.com/2016/12/17/business/economy/universal-basic-income-finland.html</url></story><parent_chain><item><author>austinjp</author><text>What&amp;#x27;s to stop UBI from &amp;quot;cancelling itself out&amp;quot; due to inflationary effects?&lt;p&gt;Prior to UBI, the lowest possible income is zero. After UBI, the lowest income is X. The poorest people in the nation will have an income of X, so X becomes the new relative zero, the new baseline. Prices of everything (food, housing, whatever) will reset relative to X. So uni will become worthless shortly after it&amp;#x27;s introduced.... but only if it is truly universal.&lt;p&gt;Someone feel free to tell me if I&amp;#x27;m missing something.</text></item></parent_chain><comment><author>kalleboo</author><text>Don&amp;#x27;t most countries already have welfare systems that keep the lowest possible income at X already? UBI is just supposed to simplify those systems by replacing them with a single non-means-tested system.</text></comment>