In Defense of Rent Control

Rent control policies, widely panned by economists, have been shown to slow displacement and keep housing affordable.

2 minute read

May 17, 2023, 12:00 PM PDT

By Diana Ionescu @aworkoffiction


For decades, rent control policies have earned the ire of economists, who argue that rent control is bad “because rent control is a price control, and price controls artificially distort well-functioning markets, resulting in a mismatch between supply and demand and the creation of the dreaded deadweight loss triangle all budding economist learn about.”

But, Mark Paul asks in The American Prospect, why should renters not be afforded the same privilege as more than half of Americans—namely, those who “enjoy de facto rent control in the form of the 30-year mortgage”?

Paul writes that there’s a problem with the traditional thinking about rent control in economist circles: it doesn’t hold up. “As recent empirical work has shown, the neoclassical account’s core assumptions—one, that rent control restricts the supply of new housing; and two, that it misallocates existing housing, thereby causing an irrecoverable collective loss—fail to hold when it comes to the real world.” Paul explains that “abundant evidence” shows that rent control does not constrain housing supply, and there is no housing boom when rent control laws are repealed.

Rent control can also slow the tide of gentrification and displacement when neighborhoods grow in popularity and value. “It helps turn housing from a nexus of profit to one of community, family, and social space.” Moreover, rent control has broad popular support. “Polling conducted in 2019 by Data for Progress found that a majority of likely voters, including a majority of independents, support rent control, with just 1 in 5 opposing such a measure.”

It’s also a matter of equity: “Homeowners, who skew white and rich, benefit tremendously from the government’s rules, regulations, and subsidies that allow them to pay a fixed monthly sum for housing over 30 years. It’s high time for the government to extend these benefits—and the economic security that comes with them—by adopting rent control to cover all people in the United States.”

Tuesday, May 16, 2023 in The American Prospect

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