How Building Regulations Subsidize Mansions
20th February 2018
Alex Tubarrok, a Real Economist, looks at the Unintended Consequences of politicians meddling.
In a market economy bidding tends to move resources from low-valued uses to high-valued uses. Regulations that prevent bidding freeze resources into low-valued uses–that’s bad for the resource owners and bad for society as the total value of production is reduced but it can be good for the consumers of low-valued uses.