The famous Swedish economist Assar Lindbeck remarked in his book on rent controls, “Rent control appears
to be the most efficient technique presently known to destroy a city—except for bombing.” Rent controls place
price ceilings on rents at levels below equilibrium rental rates for the stated purpose of making housing more
affordable for lowincome families. Using demand and supply analysis, answer the following questions:
a. How does imposing rent controls affect the number of housing units available to low-income families?
b. Under rent controls, can all low-income families get rent-controlled housing?
c. Who gains from rent controls? Who loses?
d. Why would Professor Lindbeck think rent controls are destructive?
e. Can you think of an alternative policy to make plenty of housing available to low income families that would
not be subject to the problems of rent controls?
The famous Swedish economist Assar Lindbeck remarked in his book on rent controls, “Rent control appears
to be the most efficient technique presently known to destroy a city—except for bombing.” Rent controls place
price ceilings on rents at levels below equilibrium rental rates for the stated purpose of making housing more
affordable for lowincome families. Using demand and supply analysis, answer the following questions:
a. How does imposing rent controls affect the number of housing units available to low-income families?
b. Under rent controls, can all low-income families get rent-controlled housing?
c. Who gains from rent controls? Who loses?
d. Why would Professor Lindbeck think rent controls are destructive?
e. Can you think of an alternative policy to make plenty of housing available to low income families that would
not be subject to the problems of rent controls?