discussion question 654

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Rent control is an example of a price ceiling. Price ceilings keep prices low for consumers. We can clearly see that sellers (landlords in this case) are worse off. Consider if there is an argument to be made that consumers are worse off, too.

  1. After watching the Seinfeld video clip, discuss how some consumers are made better off and some are not in a rent-control situation.
  2. What kinds of rationing mechanisms would develop to help allocate the few apartments that are available?
  3. In your opinion, do the benefits of rent control outweigh the costs?

Clip transcript attached………

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