Answer to Question #286186 in Microeconomics for Nanny

Question

Suppose you are a manager of a County government project that is meant to provide rent-regulated housing units in low-income settlements. Using your knowledge of equilibrium, advice the Governor whether this policy will be a success.

Answer 1

Rent control seems to help affordability in the small run for current tenants, but in the long-run declines affordability, fuels redevelopment, and generates negative externalities on the nearby neighborhood