Stuart tells his student government representative at his college to propose rent controls on local rental housing as a way to help students afford rental housing. Maria disagrees with Stuart, saying rent controls will make students worse off. Who is correct and why?Economic theory suggests that this policy would harm students as a whole despite the fact that some students who are able to find housing at the reduced price would benefit. Which of the following are some of the offsetting secondary effects of the rent controls that would work to the disadvantage of students?

Question

Quizplus · Accepted Answer

Economic theory suggests that while some students may benefit from reduced rental prices, rent controls will ultimately harm students as a whole through a shortage of rental housing, lower future supply, and deteriorating quality. Therefore, both Stuart and Maria are partially correct in their statements.

Stuart Tells His Student Government Representative at His College to Propose