So I'm sure /biz/ has already heard about the referendum that will be held in Switzerland this year. If it succeeds the Swiss will apparently all get an unconditional basic income of 2500 Franks per month.
What economic impact would this have? Will all the free monies accelerate demand and hence bring economic growth?
Also, with people being able to spend more won't the prices just go up like crazy and hence deminish the effect of the free income?
I suspect Switzerland may be the only country that could maybe pull it off since they have heavy immigration laws - it will cut heavily into tax though so they will need to be pretty careful with it - pretty unlikely the government could pay out 2500 francs a month to every citizen because that's more than a lot of people earn working. No workers means no taxes amd essentially they will fuck the whole system. It is too early for a universal income yet.
Couldn't you just tax consumer goods, which will undoubtetly be in more demand, more heavily to even it out?
Which would lead us back to my question of rising prices and the effect of it being deminished in the first place.
>>What economic impact would this have?
positive, the only unknown is what it does to inflation
google "income elasticity of demand" , the new money will be spent mostly on luxuries , housing and neccesities wont see a boon (I only need one house / one car / one bag of carrots from the grocer)
The luxury needs boon dies off as people adjust spending to account for the new money but it wont all be credit card debt, plenty will start small businesses and such as well (this part from the small scale studies done so far)
It also improves health and lowers addiction rates