Description
Go to the Cato Institute's home page (www.cato.org) and read the article - "How Rent Control Drives Out Affordable Housing" by William Tucker. After reading the article, answer the following questions:
a. What is a shadow market and why does one develop when there is a rent control?
b. Why is housing a particularly easy good to hoard? How does this affect newcomers to a city?
c. How do vacancy rates compare among cities with and without rent control? Does this make sense within the demand/supply framework? Why/why not?