The Impact of Rent Controls in Non-Walrasian Markets: An Agent-Based Modeling Approach
We use agent-based models to consider rent ceilings in non-Walrasian housing markets, where bargaining between landlord and tenant leads to exchange at a range of prices. In the non-Walrasian setting agents who would be extramarginal in the Walrasian setting frequently are successful in renting, and actually account for a significant share of the units rented. This has several implications. First, rent ceilings above the Walrasian equilibrium price (WEP) can affect the market outcome. Second, rent ceilings that reduce the number of units rented do not necessarily reduce total market surplus. Finally, the distributional impact of rent controls differs from the Walrasian setting.
|Date of creation:||Dec 2004|
|Date of revision:||May 2005|
|Publication status:||published in Journal of Regional Science, August 2006, 455-492.|
|Contact details of provider:|| Postal: |
Phone: 413 597 2476
Fax: 413 597 4045
Web page: http://econ.williams.edu
More information through EDIRC
|Order Information:|| Email: |
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.:
- Dhananjay (Dan) K. Gode & Shyam Sunder, 2000.
"Double Auction Dynamics: Structural Effects Of Non-Binding Price Controls,"
Yale School of Management Working Papers
ysm1, Yale School of Management.
- Gode, Dhananjay (Dan) K. & Sunder, Shyam, 2004. "Double auction dynamics: structural effects of non-binding price controls," Journal of Economic Dynamics and Control, Elsevier, vol. 28(9), pages 1707-1731, July.
- Dhananjay K. & Shyam Sunder, 2004. "Double Auction Dynamics: Structural Effects of Non-binding Price Controls," Yale School of Management Working Papers ysm141, Yale School of Management, revised 01 Apr 2008.
- Malpezzi, Stephen & Maclennan, Duncan, 2001. "The Long-Run Price Elasticity of Supply of New Residential Construction in the United States and the United Kingdom," Journal of Housing Economics, Elsevier, vol. 10(3), pages 278-306, September.
- Edward L. Glaeser, 1996.
"The Social Costs of Rent Control Revisited,"
NBER Working Papers
5441, National Bureau of Economic Research, Inc.
- Edward L. Glaeser, 1996. "The Social Costs of Rent Control Revisted," Harvard Institute of Economic Research Working Papers 1747, Harvard - Institute of Economic Research.
- Gode, Dhananjay K & Sunder, Shyam, 1997. "What Makes Markets Allocationally Efficient?," The Quarterly Journal of Economics, MIT Press, vol. 112(2), pages 603-30, May.
- Rauh, Michael T., 2004. "Wage and price controls in the equilibrium sequential search model," European Economic Review, Elsevier, vol. 48(6), pages 1287-1300, December.
- Jakob Roland Munch & Michael Svarer, .
"Rent Control and Tenancy Duration,"
Economics Working Papers
2001-7, School of Economics and Management, University of Aarhus.
- Michael Rauh, .
"Heterogeneous Beliefs, Price Dispersion, and Welfare-Improving Price Controls,"
Economics and Finance Discussion Papers
97-03, Economics and Finance Section, School of Social Sciences, Brunel University.
- Michael T. Rauh, 2001. "Heterogeneous beliefs, price dispersion, and welfare-improving price controls," Economic Theory, Springer, vol. 18(3), pages 577-603.
- Suen, Wing, 1989. "Rationing and Rent Dissipation in the Presence of Heterogeneous Individuals," Journal of Political Economy, University of Chicago Press, vol. 97(6), pages 1384-94, December.
- Fershtman, C. & Fishman, A., 1991.
"The "Perverse" Effects of Wage and Price Controls in Search Markets,"
11-91, Tel Aviv.
- Fershtman, Chaim & Fishman, Arthur, 1994. "The 'perverse' effects of wage and price controls in search markets," European Economic Review, Elsevier, vol. 38(5), pages 1099-1112, May.
- Sah, Raaj Kumar, 1987. "Queues, Rations, and Market: Comparisons of Outcomes for the Poor and the Rich," American Economic Review, American Economic Association, vol. 77(1), pages 69-77, March.
- Edward L. Glaeser & Erzo F. P. Luttmer, 1997.
"The Misallocation of Housing Under Rent Control,"
NBER Working Papers
6220, National Bureau of Economic Research, Inc.
When requesting a correction, please mention this item's handle: RePEc:wil:wileco:2004-05. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Stephen Sheppard)
If references are entirely missing, you can add them using this form.