A UBI drives up demand causing price hikes and an unchanged standard of living
Fisher, 5/8 --- Sarah has a bachelor's degree from Georgetown University and focuses her research and writing on business and finance. She has worked for the Consumer Financial Protection Bureau and her work has appeared on Business Insider and Yahoo Finance.. (Sarah Fisher, "What Universal Basic Income (UBI) Is and How It Would Work", 5-8-2023, SmartAsset, https://smartasset.com/financial-advisor/universal-basic-income)//EG
There is the possibility of inflation, too. Many lower and middle-income people have necessities that they’re not able to pay for right now. With UBI, they would finally be able to pay for those necessities all at the same time, and all at once, which could drive up demand. If inflation was high enough, it would defeat the purpose of UBI. And if costs went up significantly, most people’s spending power might effectively end up being the same. Prices would have to be raised if demand is driven up too high and supply cannot be easily increased. Higher prices would again make those basics unaffordable to lower-income people, and in the long run, a guaranteed income would not raise their .