Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/287500 
Year of Publication: 
2021
Citation: 
[Journal:] Journal of Economic Interaction and Coordination [ISSN:] 1860-7128 [Volume:] 17 [Issue:] 1 [Publisher:] Springer [Place:] Berlin, Heidelberg [Year:] 2021 [Pages:] 141-163
Publisher: 
Springer, Berlin, Heidelberg
Abstract: 
We propose a novel housing market model to explore the effectiveness of rent control. Our model reveals that the expectation formation and learning behavior of boundedly rational homebuyers, switching between extrapolative and regressive expectation rules subject to their past forecasting accuracy, may create endogenous housing market dynamics. We show that policymakers may use rent control to reduce the rent level, although such policies may have undesirable effects on the house price and the housing stock. However, we are also able to prove that well-designed rent control may help policymakers to stabilize housing market dynamics, even without creating housing market distortions.
Subjects: 
Housing market dynamics
Expectation formation and learning behavior
Rent control
Steady state, stability and out-of-equilibrium analysis
JEL: 
D84
G12
R21
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article
Document Version: 
Published Version

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