They also teach you about elasticity in econ 101. It's foolish and anti-intellectual to insist that the housing market has only two factors, while simultaneously condescending about your understanding of economics shows that you really don't understand economics, it's more about your ego.

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7 minutes ago | parent | next [-]

[deleted]

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JumpCrisscross 7 hours ago | parent | prev | next [-]

> It's foolish and anti-intellectual to insist that the housing market has only two factors

Elasticitiy moderates the effect. It doesn't reverse it. Increasing housing supply decreases housing costs. A lot of people are venally or ideologically motivated against accepting this. Our housing crisis is a political choice. (Note: I'm a homeowner.)

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mr_00ff00 6 hours ago | parent | next [-]

This reminds of a fun fact I remember learning in university.

Elasticity is the relationship between demand and supply, and there are actually very rare instances where it can be negative (where demand increases with price).

These are called Giffen goods.

https://en.wikipedia.org/wiki/Giffen_good

Explanation (that I remember)

Inelastic demand is when a good is demanded so much, that an increase in price has little affect on the total quantity (people still demand it, think like addictive substances)

So a perfectly inelastic product would be a straight line where any amount is demanded at any price.

So having the curve keep going it would get a positive slope, where higher price makes demand go up.

If I remember the example I was given was food during a famine. Supply is already low, but an additional pressure on price is the known shortage. The idea being that as the price goes up people see it as harder to get.

It’s been so long since I studied the subject so I might have gotten some things wrong here.

	▲	thaumasiotes 6 hours ago \| parent \| next [-]
		> These are called Giffen goods. The terminology is actually split; sometimes they're called Giffen goods and sometimes they're called Veblen goods. The two types have identical behavior, so there's no good reason to have two different names, but in concept Giffen goods are something poor people buy, while Veblen goods are something rich people buy. (There is a difference if you're willing to look at responses to changes other than a change in the price of a good: if you give a household more money, it will increase consumption of Veblen goods, but decrease consumption of Giffen goods.)
	▲	JumpCrisscross 6 hours ago \| parent \| prev [-]
		Cool! Thanks!

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peder 6 hours ago | parent | prev [-]

> A lot of people are venally or ideologically motivated against accepting this.

That’s the story of the last 10 years among certain types that keep regurgitating obviously wrong concepts.

	▲	JumpCrisscross 6 hours ago \| parent [-]
		> That’s the story of the last 10 years The urban orthodoxy is around demand rationing. Supply-side arguments are incredibly new. The evidence cuts in one direction. (Unless we want a hukou system.)

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Aurornis 6 hours ago | parent | prev [-]

The parent comment never claimed that the housing market only has two factors. You’re arguing against a strawman of your own creation.