When I advocate for the repeal of a particular regulation, I am often accused of thinking my proposal is a panacea. Usually, that is not the case. I point out that my proposal would move things in the right direction, but is far from a panacea.
I suspect that Brian Caplan would have the same reaction as I do to most of the policies he advocates, but he argues that housing deregulation is truly a panacea. He makes the powerful case, with data, that it will lower home prices, thereby reducing poverty, income inequality, ease traffic congestion, restore the geographic mobility we experienced in the 1970s when we were young, create construction jobs, and even reverse the decline in birth rates.
Kaplan’s conservative estimate is that housing deregulation would reduce housing costs by about 50 percent, a figure he backs up with data in a footnote. Because housing costs account for about 20 percent of the average American household budget, the cost of living would be 90 percent of current levels and living standards would increase by 11 percent (100 divided by 90 is 1.11).
Deregulation would have a bigger impact on lower-income earners, Kaplan said, for the simple reason that they spend a larger share of their income on housing, which means deregulation would also reduce income inequality.
This is a quote from David R. Henderson.Build, baby, build“, Define your ideaJune 20, 2024. Brian Caplan Book Of the same name.
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