Sunday, May 08, 2005

Rent Control

A forthcoming article on rent control from the journal of public economics (you can download the paper from Svarer's research page: http://www.econ.au.dk/vip_htm/msn/papers.html) . I'll post more current literature/campains surrounding rent control soon.....

Rent control and unemployment duration

Michael Svarer, Michael Rosholm and Jakob Roland Munch Department of Economics, University of Aarhus, Building 320, DK-8000 Aarhus C, DenmarkbInstitute of Economics, University of Copenhagen, Denmark

Abstract
In this paper we analyse how rent control affects the duration of individual unemployment. In a theoretical search model we distinguish between two effects of rent control. On one hand, rent control reduces housing mobility and hence mobility in the labour market. On the other hand, to maintain rent control benefits, unemployed individuals are more likely to accept job offers in the local labour market. Based on a rich Danish data set, we find that the probability of finding a local job increases with the rent control intensity of the housing unit, whereas the probability of finding a job outside the local labour market decreases with the rent control intensity.

Keywords: Rent control; Unemployment duration; Search model
JEL classification: C41; J61; J64; D45; L51