The link to inflation is negligible, lacks empirical evidence and was disproven in Alaska

On the other hand, what can be found in the academic literature on the empirical evidence of the price effects of a UBI? A UBI as such has never been implemented anywhere, so there is no empirical information on what would happen in this case, it is an unknown. However, some papers have analysed the price effect of monetary transfers. Cunha et al. (2019) assess the effect on prices of in-kind and cash transfers under the Programa de Apoyo Alimentario (Food Support Programme) in Mexico. Their results show how prices are reduced by in-kind transfers, as supply increases. In contrast, monetary transfers have a positive, but very small, effect on prices. The authors argue that the small effect is due to the fact that the increase in demand is offset by an increase in supply that makes the increase in prices almost negligible. They point out that the effect on prices is most relevant in the most isolated and poorest villages. This could be explained by the fact that the product markets in these villages are very closed and there is little competition between local producers, so the demand effect outweighs the effect of increased competition. Egger et al. (2021) analysed the individual and aggregate economic impacts of a $1,000 transfer to households in rural Kenya under the NGO GiveDirectly's income transfer programme. They find statistically significant positive effects on local prices, but economically negligible at less than 1%. Filmer et al. (2018) studied the price impact of the Pantawid Pamilya Pilipino cash transfer programme in the Philippines. They analysed price developments in locally traded perishable foodstuffs and in staple and packaged foods traded in national markets. They note that prices increase for the former, i.e., those dependent on the local market. The results are along the lines of suggesting that price effects depend on the production structure, and that in an open economy the demand effect, which would push prices up, is offset by the effect of competition, which would push prices down. While an implementation of UBI has not happened anywhere, and therefore no evidence is available, there are some natural experiments that are slightly similar and may provide relevant information. This is the case in Alaska, where since 1982 the government has distributed a monetary amount to all citizens from the yield of an investment fund financed by the resources obtained from oil extraction (Alaska Permanent Fund Dividend). In 2021, the dividend per individual was $1,114, which, while not a basic amount for subsistence, can be significant. No causal analysis has been conducted to observe the price impact of this dividend, although the historical inflation series for Alaska compared to the United States suggests that there have been no significant effects. The graph below shows how the evolution of the general price index for the state of Alaska in the period 1960-1982 was similar to, and always slightly below, the evolution of the price index for the country as a whole. Since 1982, when the Alaska Permanent Fund Dividend payments began, similar behaviour has been observed and the price level in Alaska has always been below the level of the index for the United States as a whole.