The Economics of Tenancy Rent Control
AbstractWe consider a rent control regime where rent increases on, and eviction of, a sitting tenant are forbidden. When apartments become vacant landlords may negotiate new rents. If inflation exists, landlords prefer to rent to short-staying tenants. Since departure-date-contingent contracts are forbidden and landlords cannot tell whether tenants are short-stayers, an adverse selection problem arises, with a Pareto inefficient equilibrium. When tenant types are determined endogenously, multiple equilibria can arise where one equilibrium is Pareto dominated. Abolition of the rent control regime, cannot only shift the equilibrium out of this inferior outcome, but also result in across-the-board lowering of rents.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Royal Economic Society in its journal The Economic Journal.
Volume (Year): 110 (2000)
Issue (Month): 466 (October)
Contact details of provider:
Postal: Office of the Secretary-General, School of Economics and Finance, University of St. Andrews, St. Andrews, Fife, KY16 9AL, UK
Phone: +44 1334 462479
Web page: http://www.res.org.uk/
More information through EDIRC
Other versions of this item:
- D40 - Microeconomics - - Market Structure and Pricing - - - General
- K10 - Law and Economics - - Basic Areas of Law - - - General (Constitutional Law)
- L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
- R31 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Housing Supply and Markets
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Hubert, Franz, 1995. "Contracting with costly tenants," Regional Science and Urban Economics, Elsevier, vol. 25(5), pages 631-654, October.
- Raymon, Neil, 1983. "Price ceilings in competitive markets with variable quality," Journal of Public Economics, Elsevier, vol. 22(2), pages 257-264, November.
- Richard Arnott, 1995. "Time for Revisionism on Rent Control?," Journal of Economic Perspectives, American Economic Association, vol. 9(1), pages 99-120, Winter.
- Guasch, J. Luis & Marshall, Robert C., 1987. "A theoretical and empirical analysis of the length of residency discount in the rental housing market," Journal of Urban Economics, Elsevier, vol. 22(3), pages 291-311, November.
- Smith, Lawrence B & Rosen, Kenneth T & Fallis, George, 1988. "Recent Developments in Economic Models of Housing Markets," Journal of Economic Literature, American Economic Association, vol. 26(1), pages 29-64, March.
- Nagy, John, 1997. "Do Vacancy Decontrol Provisions Undo Rent Control?," Journal of Urban Economics, Elsevier, vol. 42(1), pages 64-78, July.
- Stiglitz, Joseph E & Weiss, Andrew, 1981. "Credit Rationing in Markets with Imperfect Information," American Economic Review, American Economic Association, vol. 71(3), pages 393-410, June.
- Nagy John, 1995. "Increased Duration and Sample Attrition in New York City's Rent Controlled Sector," Journal of Urban Economics, Elsevier, vol. 38(2), pages 127-137, September.
- Epple, Dennis, 1998. "Rent control with reputation: theory and evidence," Regional Science and Urban Economics, Elsevier, vol. 28(6), pages 679-710, November.
- Ault Richard W. & Jackson John D. & Saba Richard P., 1994. "The Effect of Long-Term Rent Control on Tenant Mobility," Journal of Urban Economics, Elsevier, vol. 35(2), pages 140-158, March.
- Basu, Kaushik, 1989. "Technological Stagnation, Tenurial Laws, and Adverse Selection," American Economic Review, American Economic Association, vol. 79(1), pages 251-55, March.
- Bennett, John & Dixon, Huw & Hu, Helen X.Y., 2013. "The transition from dual-track pricing to a market system: Winners and losers," Economic Systems, Elsevier, vol. 37(1), pages 30-44.
- McFarlane, Alastair, 2003. "Rent stabilization and the long-run supply of housing," Regional Science and Urban Economics, Elsevier, vol. 33(3), pages 305-333, May.
- Robert Poole & Randal Verbrugge, 2007. "Explaining the Rent-OER Inflation Divergence, 1999-2006," Working Papers 410, U.S. Bureau of Labor Statistics.
- Otani, Kiyoshi, 2006. "The Coase theorem in tenant protection," Journal of Economic Behavior & Organization, Elsevier, vol. 61(3), pages 487-503, November.
- Deininger, Klaus & Jin, Songqing & Nagarajan, Hari K., 2007.
"Efficiency and equity impacts of rural land rental restrictions : evidence from India,"
Policy Research Working Paper Series
4324, The World Bank.
- Deininger, Klaus & Jin, Songqing & Nagarajan, Hari K., 2008. "Efficiency and equity impacts of rural land rental restrictions: Evidence from India," European Economic Review, Elsevier, vol. 52(5), pages 892-918, July.
- World Bank, 2007. "India : Land Policies for Growth and Poverty Reduction," World Bank Publications, The World Bank, number 15791, March.
- Juan S. Mora-Sanguinetti, 2011. "The Regulation of Residential Tenancy Markets in Post-War Western Europe: An Economic Analysis," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 8(1), pages 47-75, June.
- Krol, Robert & Svorny, Shirley, 2005. "The effect of rent control on commute times," Journal of Urban Economics, Elsevier, vol. 58(3), pages 421-436, November.
- Lawrence B. Smith, 2003. "Intertenancy Rent Decontrol in Ontario," Canadian Public Policy, University of Toronto Press, vol. 29(2), pages 213-225, June.
- Richard Arnott & Elizaveta Shevyakhova, 2008.
"Tenancy Rent Control And Credible Commitment In Maintenance,"
200812, University of California at Riverside, Department of Economics, revised Sep 2008.
- Richard Arnott & Elizaveta Shevyakhova, 2007. "Tenancy Rent Control and Credible Commitment in Maintenance," Boston College Working Papers in Economics 661, Boston College Department of Economics.
- Alastair McFarlane, 2001. "Rent stabilization and the long-run supply of housing," Urban/Regional 0109001, EconWPA.
- Kapoor, Mudit & le Blanc, David, 2008. "Measuring risk on investment in informal (illegal) housing: Theory and evidence from Pune, India," Regional Science and Urban Economics, Elsevier, vol. 38(4), pages 311-329, July.
- Richard J. Arnott & Elizaveta Shevyakhova, 2014. "Tenancy Rent Control and Credible Commitment in Maintenance," CESifo Working Paper Series 4608, CESifo Group Munich.
- Le Blanc, David, 2005. "Economic evaluation of housing subsidy systems: a methodology with application to Morocco," Policy Research Working Paper Series 3529, The World Bank.
- World Bank, 2007. "India - Land Policies for Growth and Poverty Reduction," World Bank Other Operational Studies 7818, The World Bank.
- Jin, Songqing & Deininger, Klaus W. & Nagarajan, Hari K., 2006. "Equity and efficiency impacts of rural land rental restrictions: Evidence from India," 2006 Annual meeting, July 23-26, Long Beach, CA 21305, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing) or (Christopher F. Baum).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.