Many government authorities, especially for big cities, go for what are called “

Many government authorities, especially for big cities, go for what are called “rent control” policies. The rents that landlords can charge for private flats (apartments) have to be in line with government declared policies. In essence these act as price-ceilings for renting of these privately-owned properties. Discuss what you think are the effects of such policies. In particular what the efficiency effects of such policies for the short run (when the number of rental properties are given) and the medium/long run (when landlords can decide to take their property off the rental market but also there is time to build new flats (apartments) if landlords (current and potential) want to do so. Finally, write a few lines on how any shortages or surpluses that may develop are usually dealt with and their implications on the issue of efficiency in the rental market.

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Reference no: EM132069492

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