ECO320H1 Lecture Notes - Lecture 8: Price Ceiling
Document Summary
Tutorial 1 monday, july 10, 2017 - questions for discussion: think of a landlord and tenant problem (slum tenancies, chronic disrepairs, illegal or unsafe basement suites, cock roaches, bedbugs or homelessness). Are these problems linked to a problem of rent controls (price ceiling on rents). Think this through using diagrams that show the landlord operating as a firm and the supply and demand for apartments operating as a market: the ontario government allowed the landlords of new apartment buildings built after. Any apartment rented before 1976 would be subject to rent controls, even if a new tenant took over the lease after 1976, the rent control would remain in place. The intent of the amendment was to encourage the expansion of the supply of apartments. Explain why or why not: in the farmer rancher problem we assumed that transaction costs were zero (0).
