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May 29, 2015

Homework Help: economics

Posted by sally on Monday, January 29, 2007 at 9:06pm.

If departing tenants sell access to rent-controlled apartments, whi is likely to end up with the apartments? How else might scarce rent-controlled apartments be distributed?

1) the highest bidders will end up with the appartment, with the "economic rent" from the value of a rent controlled apt being split between the departing and new tenent.

2) how else might they be distributed? In a multitude of ways.
a) remove the rent controls and let the market distribute.
b) keep the rent controls but empower a government agency to do the distributing.
c) keep the rent controls but with limited and short leases. Re-distribute the apt after the end of the lease.
d) Mandate that tenents in rent-controlled meet some easily-measured condition.
e) impose a special or civic duty to tenents
f) impose a special tax on tenents.

Be creative and you could come up with additional methods.

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