Question A:
Capping annual rent increases by corporate landlords at 5%, as proposed by President Biden, would make middle-income Americans substantially better off over the next ten years.
Responses
Responses weighted by each expert's confidence
Question B:
Capping annual rent increases at 5%, as proposed by President Biden, would substantially reduce the amount of available apartments for rent over the next ten years.
Responses
Responses weighted by each expert's confidence
Question C:
Capping annual rent increases at 5%, as proposed by President Biden, would substantially reduce US income inequality over the next ten years.
Responses
Responses weighted by each expert's confidence
Question A Participant Responses
| Participant | University | Vote | Confidence | Bio/Vote History |
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 Daron Acemoglu |
MIT | Bio/Vote History | ||
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I believe the distribution of impact on middle income, Americans would be positive, but the substantial part is uncertain.
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 Mark Aguiar |
Princeton | Bio/Vote History | ||
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 Joseph Altonji |
Yale | Bio/Vote History | ||
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 Alan Auerbach |
Berkeley | Bio/Vote History | ||
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 David Autor |
MIT | Bio/Vote History | ||
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 Abhijit Banerjee |
MIT | Did Not Answer | Bio/Vote History | |
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 Dirk Bergemann |
Yale | Bio/Vote History | ||
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The housing market is very heterogeneous across the US, thus a uniform rule is unlikely to respect the local conditions.
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 Marianne Bertrand |
Chicago | Bio/Vote History | ||
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 Markus Brunnermeier |
Princeton | Bio/Vote History | ||
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 Judith Chevalier |
Yale | Bio/Vote History | ||
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 David Cutler |
Harvard | Bio/Vote History | ||
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 Darrell Duffie |
Stanford | Bio/Vote History | ||
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The evidence is mixed but largely negative. The market pricing mechanism has substantial support in theory. There are distributional effects, but these may not favor the middle class.
-see background information here |
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 Aaron Edlin |
Berkeley | Bio/Vote History | ||
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 Barry Eichengreen |
Berkeley | Bio/Vote History | ||
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 Liran Einav |
Stanford | Bio/Vote History | ||
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 Ray Fair |
Yale | Bio/Vote History | ||
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 Edward Glaeser |
Harvard | Bio/Vote History | ||
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 Pinelopi Goldberg |
Yale | Bio/Vote History | ||
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 Michael Greenstone |
University of Chicago | Did Not Answer | Bio/Vote History | |
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 Oliver Hart |
Harvard | Bio/Vote History | ||
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 Bengt Holmström |
MIT | Bio/Vote History | ||
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 Caroline Hoxby |
Stanford | Bio/Vote History | ||
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 Hilary Hoynes |
Berkeley | Bio/Vote History | ||
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 Erik Hurst |
Chicago Booth | Bio/Vote History | ||
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 Kenneth Judd |
Stanford | Bio/Vote History | ||
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Expected inflation is only 2%. Excess inflation of rents above CPI unlikely to continue at recent rate. Rent controls are generally bad when binding.
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 Steven Kaplan |
Chicago Booth | Bio/Vote History | ||
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Rent control reduces investment in both existing and new housing. A very bad idea. Embarrassingly bad proposal.
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 Anil Kashyap |
Chicago Booth | Bio/Vote History | ||
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We have tried this kind of policy many times and it will benefit some people who get locked in below market rates, but raise costs for others who need to rent apartments that are not capped and supply will fall.
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 Pete Klenow |
Stanford | Bio/Vote History | ||
 Jonathan Levin |
Stanford | Bio/Vote History | ||
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 Eric Maskin |
Harvard | Bio/Vote History | ||
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The cap might make people who already have rented an apartment better off, but will make it harder for those who haven't to find one.
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 William Nordhaus |
Yale | Bio/Vote History | ||
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 Maurice Obstfeld |
Berkeley | Bio/Vote History | ||
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 Parag Pathak |
MIT | Bio/Vote History | ||
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 Larry Samuelson |
Yale | Bio/Vote History | ||
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Experience indicates that rent caps or controls typically backfire. Even without adverse side effects, the policy is too meager to have a substantial effect.
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 José Scheinkman |
Columbia University | Bio/Vote History | ||
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Current renters would be better of ( perhaps not substantially) but it will be worse for potential movers and new renters.
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 Richard Schmalensee |
MIT | Bio/Vote History | ||
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Some yes, many no.
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 Fiona Scott Morton |
Yale | Bio/Vote History | ||
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 Carl Shapiro |
Berkeley | Bio/Vote History | ||
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 Robert Shimer |
University of Chicago | Bio/Vote History | ||
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 Stefanie Stantcheva |
Harvard | Did Not Answer | Bio/Vote History | |
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 James Stock |
Harvard | Did Not Answer | Bio/Vote History | |
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 Nancy Stokey |
University of Chicago | Bio/Vote History | ||
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 Chad Syverson |
Chicago Booth | Bio/Vote History | ||
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Dear Lord please don't.
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 Richard Thaler |
Chicago Booth | Bio/Vote History | ||
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Doesn't seem like it would be either binding or enforceable, for better or for worse.
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 Christopher Udry |
Northwestern | Bio/Vote History | ||
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It would help some, be irrelevant for most, and hurt others by reducing availability or quality. Poor choice for redistribution, and difficult to believe effective against inflation.
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Question B Participant Responses
| Participant | University | Vote | Confidence | Bio/Vote History |
|---|---|---|---|---|
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Daron Acemoglu |
MIT | Bio/Vote History | ||
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Mark Aguiar |
Princeton | Bio/Vote History | ||
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Joseph Altonji |
Yale | Bio/Vote History | ||
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The effect will depend on trends in the general inflation rate.
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Alan Auerbach |
Berkeley | Bio/Vote History | ||
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David Autor |
MIT | Bio/Vote History | ||
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Abhijit Banerjee |
MIT | Did Not Answer | Bio/Vote History | |
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Dirk Bergemann |
Yale | Bio/Vote History | ||
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Marianne Bertrand |
Chicago | Bio/Vote History | ||
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Markus Brunnermeier |
Princeton | Bio/Vote History | ||
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Judith Chevalier |
Yale | Bio/Vote History | ||
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Directionallly, I agree, but the 5% might not be meaningfully binding.
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David Cutler |
Harvard | Bio/Vote History | ||
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Darrell Duffie |
Stanford | Bio/Vote History | ||
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Supply schedules are usually upward sloping.
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Aaron Edlin |
Berkeley | Bio/Vote History | ||
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Barry Eichengreen |
Berkeley | Bio/Vote History | ||
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Liran Einav |
Stanford | Bio/Vote History | ||
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Ray Fair |
Yale | Bio/Vote History | ||
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Edward Glaeser |
Harvard | Bio/Vote History | ||
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Pinelopi Goldberg |
Yale | Bio/Vote History | ||
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Michael Greenstone |
University of Chicago | Did Not Answer | Bio/Vote History | |
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Oliver Hart |
Harvard | Bio/Vote History | ||
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Bengt Holmström |
MIT | Bio/Vote History | ||
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Caroline Hoxby |
Stanford | Bio/Vote History | ||
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Hilary Hoynes |
Berkeley | Bio/Vote History | ||
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Unclear about the time horizon for these changes to appear; could take longer.
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Erik Hurst |
Chicago Booth | Bio/Vote History | ||
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Kenneth Judd |
Stanford | Bio/Vote History | ||
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There is an exception for new construction as well as buildings after substantial renovation.
-see background information here |
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Steven Kaplan |
Chicago Booth | Bio/Vote History | ||
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Anil Kashyap |
Chicago Booth | Bio/Vote History | ||
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The literature review cited below was sponsored by a self-interested party, but in this case the facts are pretty clear. Economists have shown over and over, if you cap prices you will reduce the supply available to buy.
-see background information here |
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Pete Klenow |
Stanford | Bio/Vote History | ||
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Jonathan Levin |
Stanford | Bio/Vote History | ||
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Eric Maskin |
Harvard | Bio/Vote History | ||
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The rent cap gives landlords an incentive to withdraw housing units from the rental market and also blunts the incentive to build new units.
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William Nordhaus |
Yale | Bio/Vote History | ||
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Maurice Obstfeld |
Berkeley | Bio/Vote History | ||
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Parag Pathak |
MIT | Bio/Vote History | ||
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Larry Samuelson |
Yale | Bio/Vote History | ||
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José Scheinkman |
Columbia University | Bio/Vote History | ||
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Where these caps bind, reduction in supply would follow
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Richard Schmalensee |
MIT | Bio/Vote History | ||
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Fiona Scott Morton |
Yale | Bio/Vote History | ||
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There is growing evidence of algorithmic collusion among rental properties, especially newer units. This would result in rents that are above competitive levels today.
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Carl Shapiro |
Berkeley | Bio/Vote History | ||
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Robert Shimer |
University of Chicago | Bio/Vote History | ||
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Stefanie Stantcheva |
Harvard | Did Not Answer | Bio/Vote History | |
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James Stock |
Harvard | Did Not Answer | Bio/Vote History | |
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Nancy Stokey |
University of Chicago | Bio/Vote History | ||
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Chad Syverson |
Chicago Booth | Bio/Vote History | ||
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If a return cap on any asset might bind, you will reduce investment in that asset, all else equal.
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Richard Thaler |
Chicago Booth | Bio/Vote History | ||
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See previous comment
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Christopher Udry |
Northwestern | Bio/Vote History | ||
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Where binding, could be substantial. Probably won't bind over most rental markets.
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Question C Participant Responses
| Participant | University | Vote | Confidence | Bio/Vote History |
|---|---|---|---|---|
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Daron Acemoglu |
MIT | Bio/Vote History | ||
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Mark Aguiar |
Princeton | Bio/Vote History | ||
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Joseph Altonji |
Yale | Bio/Vote History | ||
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Alan Auerbach |
Berkeley | Bio/Vote History | ||
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David Autor |
MIT | Bio/Vote History | ||
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Abhijit Banerjee |
MIT | Did Not Answer | Bio/Vote History | |
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Dirk Bergemann |
Yale | Bio/Vote History | ||
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Marianne Bertrand |
Chicago | Bio/Vote History | ||
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Markus Brunnermeier |
Princeton | Bio/Vote History | ||
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Judith Chevalier |
Yale | Bio/Vote History | ||
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David Cutler |
Harvard | Bio/Vote History | ||
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Darrell Duffie |
Stanford | Bio/Vote History | ||
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Someone who pays less rent for a given dwelling earn substantially more in the labor market and other income-generating markets? If that’s true, I don’t see what the mechanism would be. Maybe higher investment income from increased savings, but that seems like a small effect.
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Aaron Edlin |
Berkeley | Bio/Vote History | ||
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Barry Eichengreen |
Berkeley | Bio/Vote History | ||
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Liran Einav |
Stanford | Bio/Vote History | ||
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Ray Fair |
Yale | Bio/Vote History | ||
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Edward Glaeser |
Harvard | Bio/Vote History | ||
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Pinelopi Goldberg |
Yale | Bio/Vote History | ||
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Michael Greenstone |
University of Chicago | Did Not Answer | Bio/Vote History | |
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Oliver Hart |
Harvard | Bio/Vote History | ||
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Bengt Holmström |
MIT | Bio/Vote History | ||
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Caroline Hoxby |
Stanford | Bio/Vote History | ||
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Hilary Hoynes |
Berkeley | Bio/Vote History | ||
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Erik Hurst |
Chicago Booth | Bio/Vote History | ||
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Kenneth Judd |
Stanford | Bio/Vote History | ||
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Only owners of more than 50 units are affected. Many poor people would find this does not apply to their landlords. Rent controls have a bad track record of helping the poor.
-see background information here |
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Steven Kaplan |
Chicago Booth | Bio/Vote History | ||
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Might increase it by benefiting existing renters and hurting new renters.
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Anil Kashyap |
Chicago Booth | Bio/Vote History | ||
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Some of the winners whose rents get capped will be wealthy people. This too blunt an instrument (i.e. not targeted to helped lower income people) to deliver this kind of payoff.
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Pete Klenow |
Stanford | Bio/Vote History | ||
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Jonathan Levin |
Stanford | Bio/Vote History | ||
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Eric Maskin |
Harvard | Bio/Vote History | ||
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The argument here is the same as for issue 1: some lower-income people will be helped; others will be hurt. I'm not sure what the overall effect on income inequality will be.
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William Nordhaus |
Yale | Bio/Vote History | ||
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Maurice Obstfeld |
Berkeley | Bio/Vote History | ||
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Parag Pathak |
MIT | Bio/Vote History | ||
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Larry Samuelson |
Yale | Bio/Vote History | ||
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José Scheinkman |
Columbia University | Bio/Vote History | ||
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Richard Schmalensee |
MIT | Bio/Vote History | ||
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Fiona Scott Morton |
Yale | Bio/Vote History | ||
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Carl Shapiro |
Berkeley | Bio/Vote History | ||
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Robert Shimer |
University of Chicago | Bio/Vote History | ||
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If there is an impact on income inequality, it would come through reducing the value of some assets owned by high income individuals. There is no credible reason for this to boost income at the bottom of the distribution.
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Stefanie Stantcheva |
Harvard | Did Not Answer | Bio/Vote History | |
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James Stock |
Harvard | Did Not Answer | Bio/Vote History | |
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Nancy Stokey |
University of Chicago | Bio/Vote History | ||
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Chad Syverson |
Chicago Booth | Bio/Vote History | ||
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Richard Thaler |
Chicago Booth | Bio/Vote History | ||
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Just for show. If enacted the most likely outcome is a lot of enforcement sludge.
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Christopher Udry |
Northwestern | Bio/Vote History | ||
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