Economist Bryan Caplan has done it again. His latest graphic nonfiction book is Build, Baby, Build: The Science and Ethics of Housing Regulation, illustrated by Ady Branzei and published by the Cato Institute. (His first was Open Borders: The Science and Ethics of Immigration.)
Caplan’s target is a worthy one: zoning and other (anti-)housing regulations, which damage many people in various ways, some that will surprise you. While he could have written a conventional book, it almost certainly would have been dreadfully dull and accessible to only a few academics and policy wonks. That is no reflection on Caplan, an excellent writer. It’s in the nature of the subject. I probably don’t need to persuade many people of that statement.
So what’s the problem? All state and local governments suppress the supply of houses and apartments throughout the country—and the problem has gotten worse for most of the country. Let’s be clear: many more dwellings of all types, including high-rise apartments, would exist and be much cheaper were it not for government prohibitions, requirements, and other cost-boosting impediments.
The housing shortage, then, is not caused by greedy construction executives trying to squeeze buyers and renters into poverty or by immigrants. It’s caused by do-gooder politicians and bureaucrats along with members of the public who just don’t get it. Construction companies would love to build, sell, and, rent more units, which would drive down the price. Governments won’t let them. That’s criminal.
Basic economics teaches that market prices result from supply and demand. If government restricts the supply of something people want, whether or not by design, prices will rise. For housing, this is most aggravated in the most desirable parts of the country, where the demand for homes is high because of the many amenities, including high-paying jobs. In a free market, high prices beckon new competitors and increase supply, thereby lowering prices. It’s a beautiful process when allowed to work.
Few things are more certain than the relationship between supply and demand on the one hand and price on the other. Yet many people don’t get it.
Something new!!! This article is about a comic book that shows the reason why free-market, without restrictions, in building housing would benefit us all in many different ways. It shows, in a graphic book how the benefits would flow to everyone and what the benefits would be. The author even lets everyone know that there is no such thing as a free lunch in this as in any other thing. Yes, we can alleviate the high price of housing, create better living conditions and get rid of crowing, we just have to let the markets work and pay the prices for externalities to the housing market.