3 ms·

Great. So let’s have some academic papers on the front page instead of this junk.

by romed 8y ago

Bartweiss 8y ago
I'm curious if there's a specific criticism here? I mean, the piece goes out of its way to cite Krugman calling it "among the best-understood issues in all of economics". HN generally discourages old content by labelling it, and the audience-appeal of this piece isn't the authors, it's that it specifically addresses a 2018 California ballot initiative. I don't think we're going to get a great academic source on the current ballot initiative, because the consensus is that there's nothing new to say! G Sternlieb, The Urban Housing Dilemma (1972) isn't going to hit the front page, but everybody from the Cato Institute to Krugman is working off the same old bases.
- romed 8y ago
  The consensus exists only on the thin slice of debate that pertains to economics. Economists agree that rent control, all other things held equal, reduces housing supply. Nobody seriously debates. However there are moral and ethical and sociological dimensions to the question. For example: allowing rents to rise to whatever the market will bear effectively rewards landlords for creating scarcity. Should landlords be rewarded for creating scarcity? Or should they be punished for it? Do long-domiciled tenants who have contributed to the desirability of a place have a legitimate interest in being allowed to stay there? My main beef with this piece is that HN pretends to keep politics off the front page but here we have right-wing propaganda masquerading as science on election day where the issue is on the ballot in California. If we're going to allow advocacy then the mods should stop automatically flagging whole classes of posts.
  - gwright 8y ago
    You seem to be ignoring the self-regulating aspect of a free market. As landlords rake in more money there are more and more incentives to develop new properties to take advantage of the profit opportunity. The market mechanism works to mitigate run-away profits. It seems to me that government restrictions on supply or new competitors is the most common reason for the absence of competition and higher prices paired with high profits.
    - romed 8y ago
      You must live somewhere else. Here in California the landlords have rigged everything so that it's impossible to build. They are well-protected from new market entrants. In addition, we have statewide rent control for landlords, in the form of Proposition 13.
      - Bartweiss 8y ago
        It's (at best) a wicked problem, in the original policy sense. Proposition 13 is understandable for the same reasons rent control is, but also terrible policy for (some of) the same reasons as rent control. California's total unwillingness to build new housing (at least where people want to live) is even worse policy, although I object to seeing it attributed solely to landlords. The combination means all possible cost-fighting solutions will fail; all thats left is to decide how to distribute the damage. And so all of the policy options also suck. Rent control is at most a stopgap for some current renters, which does nothing for those newly seeking housing, further discourages construction (it may not apply to new developments, but it sets precedent and they're going to be old developments eventually), and rewards landlords for driving away their tenants. Repealing Prop 13 is not only unattainable but likely to drive out the most vulnerable owners as broke cities try to repair their budgets. Restricting Prop 13 to non-rental properties suitably targets rentiers, but threatens even faster tax growth due to the smaller base - which will render leasing unprofitable with rent control or passed on to tenants without it. Even building new housing, the only thing that really stands to unwind the problem, is a mess. At small or moderate levels it will only slow growth and encourage people to move in, while at large rent-reducing scales it will wipe out every non-rentier property owner who bought at inflated rates. So, yes, California's housing looks more or less hopeless. In most places I'm against rent control as a bad solution to a solvable problem. In California... dilemmas have outcomes.
deepakhj 8y ago
https://web.stanford.edu/~diamondr/DMQ.pdf https://web.stanford.edu/~diamondr/DMQ.pdf "This reduction in rental supply likely increased rents in the long-run, leading to a transfer between future San Francisco renters and renters living in San Francisco in 1994. In addition, the conversion of existing rental properties to higher-end, owner-occupied condominium housing ultimately led to a housing stock increasingly directed towards higher income individuals. In this way, rent control contributed to the gentrification of San Francisco, contrary to the stated policy goal. Rent control appears to have increased income inequality in the city by simultaneously limiting displacement of minorities and attracting higher income residents. These results highlight that forcing landlords to provided insurance against rent increases can ultimately be counterproductive. If society desires to provide social insurance against rent increases, it may be less distortionary to offer this subsidy in the form of a government subsidy or tax credit. This would remove landlords’ incentives to decrease the housing supply and could provide households with the insurance they desire. A point of future research would be to design an optimal social insurance program to insure renters against large rent increases."

Great. So let’s have some academic papers on the front page instead of this junk.

by romed 8y ago

Great. So let’s have some academic papers on the front page instead of this junk.

I'm curious if there's a specific criticism here? I mean, the piece goes out of its way to cite Krugman calling it "among the best-understood issues in all of economics". HN generally discourages old content by labelling it, and the audience-appeal of this piece isn't the authors, it's that it specifically addresses a 2018 California ballot initiative. I don't think we're going to get a great academic source on the current ballot initiative, because the consensus is that there's nothing new to say! G Sternlieb, The Urban Housing Dilemma (1972) isn't going to hit the front page, but everybody from the Cato Institute to Krugman is working off the same old bases.

romed 8y ago
The consensus exists only on the thin slice of debate that pertains to economics. Economists agree that rent control, all other things held equal, reduces housing supply. Nobody seriously debates. However there are moral and ethical and sociological dimensions to the question. For example: allowing rents to rise to whatever the market will bear effectively rewards landlords for creating scarcity. Should landlords be rewarded for creating scarcity? Or should they be punished for it? Do long-domiciled tenants who have contributed to the desirability of a place have a legitimate interest in being allowed to stay there? My main beef with this piece is that HN pretends to keep politics off the front page but here we have right-wing propaganda masquerading as science on election day where the issue is on the ballot in California. If we're going to allow advocacy then the mods should stop automatically flagging whole classes of posts.
- gwright 8y ago
  You seem to be ignoring the self-regulating aspect of a free market. As landlords rake in more money there are more and more incentives to develop new properties to take advantage of the profit opportunity. The market mechanism works to mitigate run-away profits. It seems to me that government restrictions on supply or new competitors is the most common reason for the absence of competition and higher prices paired with high profits.
  - romed 8y ago
    You must live somewhere else. Here in California the landlords have rigged everything so that it's impossible to build. They are well-protected from new market entrants. In addition, we have statewide rent control for landlords, in the form of Proposition 13.
    - Bartweiss 8y ago
      It's (at best) a wicked problem, in the original policy sense. Proposition 13 is understandable for the same reasons rent control is, but also terrible policy for (some of) the same reasons as rent control. California's total unwillingness to build new housing (at least where people want to live) is even worse policy, although I object to seeing it attributed solely to landlords. The combination means all possible cost-fighting solutions will fail; all thats left is to decide how to distribute the damage. And so all of the policy options also suck. Rent control is at most a stopgap for some current renters, which does nothing for those newly seeking housing, further discourages construction (it may not apply to new developments, but it sets precedent and they're going to be old developments eventually), and rewards landlords for driving away their tenants. Repealing Prop 13 is not only unattainable but likely to drive out the most vulnerable owners as broke cities try to repair their budgets. Restricting Prop 13 to non-rental properties suitably targets rentiers, but threatens even faster tax growth due to the smaller base - which will render leasing unprofitable with rent control or passed on to tenants without it. Even building new housing, the only thing that really stands to unwind the problem, is a mess. At small or moderate levels it will only slow growth and encourage people to move in, while at large rent-reducing scales it will wipe out every non-rentier property owner who bought at inflated rates. So, yes, California's housing looks more or less hopeless. In most places I'm against rent control as a bad solution to a solvable problem. In California... dilemmas have outcomes.

deepakhj 8y ago

https://web.stanford.edu/~diamondr/DMQ.pdf https://web.stanford.edu/~diamondr/DMQ.pdf "This reduction in rental supply likely increased rents in the long-run, leading to a transfer between future San Francisco renters and renters living in San Francisco in 1994. In addition, the conversion of existing rental properties to higher-end, owner-occupied condominium housing ultimately led to a housing stock increasingly directed towards higher income individuals. In this way, rent control contributed to the gentrification of San Francisco, contrary to the stated policy goal. Rent control appears to have increased income inequality in the city by simultaneously limiting displacement of minorities and attracting higher income residents. These results highlight that forcing landlords to provided insurance against rent increases can ultimately be counterproductive. If society desires to provide social insurance against rent increases, it may be less distortionary to offer this subsidy in the form of a government subsidy or tax credit. This would remove landlords’ incentives to decrease the housing supply and could provide households with the insurance they desire. A point of future research would be to design an optimal social insurance program to insure renters against large rent increases."