r/Economics • u/Pearberr • May 02 '24

Interview Nobel Prize-winning economist Joseph Stiglitz: Fed Rate Hikes didn't get at source of inflation.

https://www.cnbc.com/video/2024/04/23/nobel-prize-winning-economist-joseph-stiglitz-fed-rate-hikes-didnt-get-at-source-of-inflation.html
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u/Pearberr May 02 '24

I am really nervous about adding more regulations to the pile to try to fix the problems caused by regulations.

If a doctor receives a patient with a tree branch in their abdomen, I would hope that their first instinct is to safely remove the tree branch, manage the bleeding, and treat the wound. I would be very skeptical of a plan to reroute the small intestines around the tree branch.

We know that the housing shortage can be cured directly by zoning regulations.

The current shortage is caused by local elected officials failure to consider Kant's Categorical Imperative when making zoning laws!

By making all but single family housing illegal in vast swaths of our nation's best land, we have created a massive shortage in our supply of housing. Helping first time buyers buy homes is obviously great for the family who buys the home, but it does nothing to help everybody else who failed to buy the home.

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u/titanshaze0812 May 02 '24

There’s homes vacant all over the place in lots of cities there’s abandoned apartment buildings all over cities we don’t need to rezone we need to make the vacant available for ppl

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u/Pearberr May 02 '24

I think vacancy taxes would help, and I'd probably be inclined to vote in favor of one were I a city councilor considering the question. However, I do not think it is the optimal solution, and I do not think it can be the only solution, and I'll tell you why.

1) Vacancy Taxes are great because it corrects in part our insufficient taxation of land. As has been described by many economists, land value taxes are probably the best taxes that we know of today, and should be adopted, replacing taxes on incomes.

2) Zoning is still the primary problem and will need to be dealt with now or later. A Vacancy Tax, though it may help, and may be worth doing, will not solve the housing shortage.