>> This is the first lesson of economics.

Ya. Lesson #1, not the final lesson but the ABC lesson taught to people who are just starting to learn. Later lessons will cover price concepts that make lesson #1 less relevant, such as that in realworld economics people are not all treated identically. Application of identical rules to all earners generally does not end well. That's why progressive taxation is a thing. A simple extension of progressive taxation is progressive handout/benefit schemes, money for the poor but not also to the rich. But that is probably lesson #10 or #12 and we are still on #1.

It misinterprets Lesson #1 even.

A city is not printing money, and has no ability to increase the money supply. There's no chance a local program like this leads to inflation.

It conceivably raises velocity which would lead to inflation.

What if everybody gets basic income to cover basic needs (housing / food) and then can do work, to unlock extra-money ?

Whether they work or not, they benefit from the situation.

I'm still concerned though, that landlords, seeing that everybody has 1000 USD / month in the pocket, that they raise prices by 1000 USD :|

Yeah you are assuming so many things there. Supply and demand definitely works but when you simplify out every detail you come to some bad conclusions. Giving people money will cause only specific things to raise in price. Things like houses where the supply is inelastic. Prices will rise because more people can buy by them but there are virtually only X amount. Things like food however will stay pretty steady because if there are more people competition will cause merchants to bring more food and undersell the competition.

In this examples test phase they also aren't sending everyone money. They are randomly seeding money to several households in the community, which will also influence its spending. Because this is surprise money it probably has a higher change of going into deferred payment. I am not convinced this test a good way to test something like a UBI but its not simple as lesson one. I think its a huge mistake to think you've learned everything and can holistically judge broad scale policy from just lesson one but thats just me.

I agree this surprise money is not a good test of UBI. An actual wide-scale implementation of UBI seems like a great way to provide landlords with a bunch of extra cash.

We're already doing this, just not with individuals. Ever wonder why housing keeps getting more expensive while sitting empty? The Federal reserve keeps buying the debt the buildings are bought with to prevent the market from crashing.

You're half right, we shouldn't do that. We already are though and the question is: should we do it in a way that makes poor people homeless or not.

The whole point of UBI is that production has become so easy that the average person can't find work.

Think about it: the whole point of technology is to do less with more, and technology works and it get better over time.

It's "works as intended" for machines to do the work that machines can do. And the realm of "work that machines can do" is continually growing.

Eventually you have infinite supply of everything and everyone is unemployed and unemployable, so they have no money so there is no demand.

Infinite supply and no demand.

One solution is just to print money and give it to people. It's basically a quota on the output of the magic replicator machine from Star Trek.

I don't know if it will work, but it sounds better to me than just letting people live in tents downtown like they're doing now. (I'm in SF and it's gotten pretty gnarly here. There are "for rent" signs and people living in tents all over the place. Think about how nuts that is...)

This isn’t necessarily true. There’s been a lot of money injected into the economy in the last 10 years and it hasn’t caused mass price increases.

Inflation has two definitions. There's monetary inflation and price inflation. The former refers to an expansion in the money supply. If you fund any social program purely out of tax revenue, then there is no monetary expansion.

But monetary inflation itself doesn't necessarily lead to price inflation. If you have a quickly growing population, but a money supply that is growing slowly, then you would need faster monetary expansion simply to maintain price stability.

Price inflation is what people really care about. But it is also not just one uniform thing. We know that healthcare, land rent, and education are what have been rising in the US over many decades, while things like food, clothing, electronics, energy, and raw materials have been pretty flat or even decreasing in price.

The distinguishing factor is that the former tend to have both inelastic supply and inelastic demand, while the latter category has elasticity in both. What this means is that the former category is characterized by economic rents more than supply costs. Easy monetary policies may inflate bubbles in these targeted areas, but the fact that it is so localized gives a clue as to the real cause: economic rent-seeking and landlordism. Pre-capitalistic and parasitical sorts of business models, often relying on the government to create artificial scarcity. If this stuff happens in essential industries then it also means the demand is inelastic, and we're forced to eat the higher prices, which are whatever they think the consumers can afford.

All of this means that without tackling the economic rents, such as by raising tax revenues that target them, then we cannot solve this problem. And if people can afford more, the economic rents will increase. For instance, via a basic income that is not funded out of economic rent. But if it were funded out of rent, then it would be fine. Taxes that are placed upon economic rents have a curious property where they cannot be passed onto anyone else. Zero deadweight loss.