Category Housing
No, your kids don’t want your stuff
Dining room sets that cost thousands of dollars new can be picked up for a few hundred dollars (or less) on Kijiji or Craigslist. Here’s a quote from typical ad: “Solid wood in Excellent condition. Rarely used. I am moving to a smaller house and it needs to go. Price is negotiable.” It’s part of […]
A very simple model of too much city
100 identical individuals choose to live in one of two identical locations. The only thing they care about is how many people live in the same location. Let W individuals choose to live in the West, so 100-W choose to live in the East. The Utility of living in the West is U(W), and the […]
Migration, Wages, and Corner Solutions
I'm trying to get my head straight on something. Macro farmboy lost in Urban Economics again. Read at your own risk. If immigration always increases real wages (or well-being), do we end up in a "corner solution", where everyone bunches together in one location leaving other locations empty? If so, that's a reductio ad absurdam, […]
Upward-sloping Demand curves for Labour and Housing
I have a simple thought-experiment ("model") that helps me think about the relationship between: migration; planning restrictions; wages; and house prices (or rents). Assume all workers are identical, all houses are identical, and it's strictly one worker lives in one house. The government of a small city/state controls both immigration and the number of houses […]
Statistics Canada’s historical housing cost data is wrong
In the early 1960s, Canadian economic historian Marvin McInnis started digging through the Dominion Bureau of Statistics archives, looking for city-level information on rental prices. While there, he discovered something strange and disturbing: A prominent theme of my career has been to reveal anomalies in what has been put forward as evidence. One instance is known only to me. […]
We Are Adding Less to Housing Supply
Housing prices particularly in places like Toronto and Vancouver are still a big issue and what is driving them is the subject of debate. There is Josh Gordon’s recent policy paper, which places the main emphasis on demand side factors and there is the recent story raising alarm on Toronto’s “housing bubble”. There are of […]
Supply Constraints and Ontario Housing Prices
A key feature of housing markets in Canada over the last decade is the sustained increase in prices particularly in larger urban centers such as Vancouver and Toronto. Data from Canada Mortgage and Housing (CMHC) on average MLS housing prices for Ontario as a whole shows that between 1990 and 2015 the increase was from […]
Do (local) housing demand curves slope up?
Take this post with a truckload of salt. This is a second in my series in which "Lost Macro Farmboy tries to get his head around Urban Economics". Think of it as sceptical pushback. I might easily be wrong, but those who know a lot more Urban Economics than I do should be able to […]
Secular stagnation, liquidity, and rent/price ratios
No answers here, only questions. By "secular stagnation" I mean "declining equilibrium real interest rates". Most explanations of secular stagnation say it is caused by a rising desire to save and/or a falling investment demand. Call this the "Saving/Investment Hypothesis". But there are lots of different real interest rates. For example, the real interest rate […]
House prices and inflation targeting
"Should house prices be included in the CPI?" is not a good question to ask. The best answer to that question is another question: "Why do you want to know?" Or, "It depends; what are you planning to use the CPI for?" Instead, it would be better to ask the question in a different way […]
Worthwhile Canadian Initiative 
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