Competition still exerts a downward force on prices, and as the cost of labor increases the cost of developing automation will become more and more attractive to replace it.
You don't need UBI then, prices will just go down towards 0 because of competition, resulting in free food / housing / clothing / mobile phones for everyone.
> For which the market should correct by increasing their compensation, thus incentivising people to return to working, no?
Partially, but some of those increased compensation costs will translate to increased prices for everyone. That reduces the real value of a fixed UBI amount.
It's a given that a significant amount of UBI will be absorbed by inflation, particularly in housing prices in competitive cities. If everyone in a city is already competing for a limited housing supply and suddenly everyone has an extra $1000 per month, I wouldn't be surprised if the cheapest housing costs suddenly increased by nearly $1000 per month.
==If everyone in a city is already competing for a limited housing supply and suddenly everyone has an extra $1000 per month, I wouldn't be surprised if the cheapest housing costs suddenly increased by nearly $1000 per month.==
If we accept this logic as true, wouldn't it incentivize builders to increase housing supply? They would want to capture those higher rents and prices, right?
How so? The compensation is increased because less people are working, so the cost of labour is fixed (which is neglible in any case in a post-scarcity society as envisioned in the future)
If labor remains fixed then people as a whole have more money. Prices go up due to inflation and increased demand, no? I realize that's simplistic, but is it not generally true?
For which the market should correct by increasing their compensation, thus incentivising people to return to working, no?