TY  - JOUR
AU  - Glaeser,Edward L.
AU  - Luttmer,Erzo F. P.
TI  - The Misallocation of Housing Under Rent Control
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 6220
PY  - 1997
Y2  - October 1997
UR  - http://www.nber.org/papers/w6220
L1  - http://www.nber.org/papers/w6220.pdf
N1  - Author contact info:
Edward L. Glaeser
Department of Economics
315A Littauer Center
Harvard University
Cambridge, MA 02138
Tel: 617/495-0575
Fax: 617/495-7730
E-Mail: eglaeser@harvard.edu

Erzo F.P. Luttmer
6106 Rockefeller Center, Room 305
Department of Economics
Dartmouth College
Hanover, NH 03755
Tel: 603/646-6479
E-Mail: Erzo.FP.Luttmer@Dartmouth.Edu
AB  - When there are binding price controls, there are shortages and the allocation of goods across consumers may not be efficient.  In general, the misallocation costs of price controls are first order, while the classic welfare losses due to undersupply are second order.  This paper presents an empirical methodology for estimating the degree of misallocation of housing units due to rent control in New York City.  This methodology involves comparing the relative consumption of different demographic groups within the rent controlled area with the relative levels of consumption in a free market area.  Our best estimate of the costs of rent control in New York due to the misallocation of rental apartments is 200 dollars per apartment annually.
ER  -