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- Title
DISCUSSION.
- Authors
Grampp, William D.
- Abstract
The article presents a discussion on housing inventories. The author mentions distinction between the stock of rental housing, as a capital agent and its income expression in the supply function, which relates rent and the quantity of housing offered for rent in any time period. The usefulness of distinguishing the housing stock from the supply function becomes apparent when a comparison is made between the value of all units occupied by tenants and the value of all units in the stock. The supply function, is not altogether inelastic and decline in demand would produce, in the short run, a decrease in rents sufficient to attract full occupancy. Changes in demand consequently will affect the quantity offered for rent. Demand changes also will change the capital value of housing, although less than if the supply were completely inelastic. So long as in the rental market the quantity demanded the quantity supplied, one cannot maintain that families are leaving it because they do not care to rent. According to the author, an individual who buys a house because he cannot rent is showing a preference for home ownership over renting.
- Subjects
HOUSING; RENT; RENTAL housing; ECONOMIC equilibrium; LANDLORD-tenant relations; ECONOMIC demand; INELASTIC demand; HOME ownership; STOCKS (Finance)
- Publication
American Economic Review, 1951, Vol 41, Issue 2, p583
- ISSN
0002-8282
- Publication type
Article