The political economy of Citizens Basic Income

Chapter 12 discusses the history of political economy, and defines it as the application of the methods of economics to the relationship between the economy and institutions, and particularly the institutions of government. The chapter finds that economic growth is facilitated by secure incomes, innovation in the economy, redistribution from rich to poor, government spending, and taxing the proceeds of production currently going to capital and distributing the proceeds to consumers: all of which a Citizen’s Basic Income would encourage. Citizen’s Basic Income is also found to promote sustainable growth. The ways in which money is created, the volume of money’s relationship to Gross Domestic Product, and the gap between the proceeds of production and money available for consumption, and possibility of government-created money funding a Citizen’s Basic Income, are discussed. A final section discusses political economy paradigms and the history of neoliberalism.