wallofwolfstreet

Thanks for the reply! I was just using a change in military spending in the example above because it helped to illustrate two very different baskets of goods. You're right that the inflation would only be a "one off", but I just wanted to show how such a price change is possible just by the redistribution of capital, without any increase in the total amount.

I don't believe financing the UBI in a revenue-neutral way guarantees no inflation. Consider all the money being spent on military goods is now spent on the UBI (i.e. revenue neutral). The goods that were previously purchased by the military (guns and ammo) will go down in price to reflect the decreasing demand. The goods that are purchased by people who have more money in their pockets thanks to UBI (food, clothes, etc) will go up in price to reflect the increase in demand. Thus inflation occurs in the basket of goods meaningful to the average consumer, but deflation occurred in the basket of goods that previously received funding.