An analysis of UBI phase-in was clear on the positive relationship between BI and consumption/wage inequality.

First, universal basic income funded by an increase in capital gains raises the consumption of non-oil goods, which are mostly demanded by low-income households, and decreases oil consumption, which is primarily demanded by higher-income households. As the share of lower-income households is greater within the monetary union, their consumption demand offsets the consumption demand of higher-income households and leads to an increase in total consumption and a reduction in consumption inequality.

Second, universal basic income funded by an increase in corporate income tax contravenes the operation of less competitive corporations, which enhance the profitability of investment within the union, both in the short and the long term, and hence the total factor productivity growth. As a result, investment opportunity costs fall, and competitive corporations find it optimal to invest more, while less competitive corporations find it optimal to invest less. This substitution effect intensifies the increase in investment and labor demand. Labor demand expansion puts upward pressure on labor income and induces a reduction in income inequality.

More importantly, beyond this substitution effect, universal basic income funded by total phasing-out of oil subsidies additionally accentuates the expansionary effect of a positive productivity shock via an income effect. Thus, under this third fiscal policy, the effectiveness of universal basic income is optimal and higher than under the two previous first and second fiscal policies. As oil subsidies are eliminated due to the fiscal policy, the income effect supplements the substitution effect, so that oil consumption by lower-income households drastically collapses while their non-oil consumption jumps. The total consumption of the currency union expands more, as does the reduction of consumption inequality. The income effect further accentuates the positive effect of total factor productivity via investment input productivity. The income effect of universal basic income, funded by the phasing-out of oil subsidies, unleashes labor productivity, which consistently rises above the benchmark level and other two fiscal policy levels, on the one hand, long-term growth, on the other, employment. Both the increase in aggregate output and employment further diminish income inequality within the currency union. Headline inflation declines below the benchmark level under the first and second fiscal policies, and persistently under the third fiscal policy, mainly because of the fall of . The drastic fall in core inflation particularly enhances welfare within the currency union as more and more low-income households are now consuming more non-oil goods, which are cheaper, rather than oil-dependent goods, which are expansive.

These findings show that the effectiveness of universal basic income on productivity growth, inequality, and welfare is dependent on the type of fiscal policy used to fund it, specifically the trade-off between tax policy and transfer policy. While universal basic income funded by tax policies is effective in reducing inequality and increasing growth and welfare, universal basic income funded by completely eliminating oil subsidies appears to be the best policy in terms of growth, welfare, and inequality reduction.

All in all, to influence long-term productivity growth, welfare, and inequality via universal basic income within the monetary union, the government will face a trade-off between expanding the tax base and reducing public spending.