Relay-Version: version B 2.10 5/3/83; site utzoo.UUCP
Posting-Version: notesfiles - hp internal release 1.2; site hp-pcd.UUCP
Path: utzoo!watmath!clyde!akgua!sdcsvax!sdcrdcf!hplabs!hp-pcd!daver
From: daver@hp-pcd.UUCP
Newsgroups: net.flame
Subject: More on rent control
Message-ID: <4300008@hp-pcd.UUCP>
Date: Tue, 22-May-84 22:32:00 EDT
Article-I.D.: hp-pcd.4300008
Posted: Tue May 22 22:32:00 1984
Date-Received: Fri, 1-Jun-84 03:51:40 EDT
Organization: Hewlett-Packard Portable Computer Division - Corvallis, OR
Lines: 29
Nf-ID: #N:hpcvrd:4300008:000:1761
Nf-From: hpcvrd!daver    May 22 18:32:00 1984

I think the question in rent control is one of supply and demand.  Suppose 
there were a very desirable area where many people would like to live (e.g.
good climate, clean air, things to do, etc.), but there was not enough room
for everyone to live there.  How do we decide who gets to live there and who
doesn't.  One method, which is common in some countries, is that an authority
arbitrarily decides who lives there and who doesn't.  In a free economy the
decision is made by individuals bidding up the price of living there until the
number of people who are willing or able to pay the price matches the room
available.  In theory people will allocate their money according to their
personal priorities, so each individual decides how much he or she wants to
spend on a living space.

Rent control inhibits this mechanism.  In areas in which only existing rents
are controlled, with new tenants required to pay the full market value,
priority for living in an area will be given to people who already live in 
that area, while people who want to move into the area are required to bid
against others for fewer available living spaces.  In areas where all rents
are equally controlled the mechanism breaks down completely and moving into
the area depends on knowing someone there or being lucky or, in many cases,
greasing the proper palms to be allocated an opening; the alternatives would
be first-come-first-served or an authority arbitrarily deciding who moves in.

I think the real complaint of most people who have been flaming about rents is
not the rental costs, but rather the non-uniform distribution of money
throughout the population.  If this is the case, it would be more constructive
to state it this way.

Dave Rabinowitz
hplabs!hp-pcd!daver