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I blame a tech bubble. The salaries in these cities are massively inflated and it's messing up local economies in strange ways.
by 2OEH8eoCRo0 2y ago
I blame a tech bubble. The salaries in these cities are massively inflated and it's messing up local economies in strange ways.
- bobthepanda 2y agoTech is not present in every city in the US. Really the big issue is lack of housing production, which was significantly lower in the 2010s and we still have not made up for all that lost time: https://fred.stlouisfed.org/series/HOUST https://fred.stlouisfed.org/series/HOUST
- blackhawkC17 2y agoI wonder why tech employees (labour) earning high salaries should represent a problem. That's a very good thing.
- Arnt 2y agoThe somewhat informed argument is that a few per cent of well-paying renters drive up the marginal price, and landlords try to stay close to the marginal rate.
- llamaimperative 2y agoYou'd intuitively think this is true, but empirically it has not been true anywhere ever. Rising productivity yields rising inequality. The issue is that land rents rise to swallow all productivity gains (we end up calling this "cost of living," as if it emerges out of the ether). That's why in ultra-high productivity locales like Palo Alto, $200k/yr is a welfare wage. The land is ludicrously expensive because those prices rise in lockstep with productivity -- which they don't have to. Land costs nothing to exist. It is there ready to be used no matter what the price is. But everything on the land, which is everything, must then pay rent to the landowners, giving rise to "cost of living." You can disprove this by showing me a location with high productive power and low land prices, or a location with low productive power and very high land costs (that's not abandoned or a vacation spot for highly productive people).