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If you raise the price of tea, at some point I'll stop buying tea. If you raise the price of housing, I don't stop needing a place to live. "Supply and demand"
by caditinpiscinam 3y ago
If you raise the price of tea, at some point I'll stop buying tea. If you raise the price of housing, I don't stop needing a place to live. "Supply and demand" is the "friction-less, mass-less pulley" of econ: a simplistic principle for a hypothetical world.
- cycrutchfield 3y agoYou also need food to live, but the principles of supply and demand seem to hold quite well for such goods. You can go ahead and call these principles simplistic but it doesn’t mean they are wrong in broad terms.
- satvikpendem 3y agoIt's simple, you will move, either voluntarily or be forced to via rising costs. I know many people who lived in high cost of living areas that now live in lower cost of living areas. Yes, they had to find new jobs and new friends, but that is really no different than any other time in human history. This is not to say that we should not build more housing so as to increase supply and thus lower prices, of course.