Ep 36: Rent Control in India with Sahil Gandhi and Richard Green

10/19/22 • 59 min

1 Listener

Usually, cities with lots of vacant housing have slow rent growth (or low rents), while lower vacancy rates are associated with higher rents. But many Indian cities have an unusual, seemingly paradoxical problem: high vacancy rates and high rents. Why? According to research by Dr. Sahil Gandhi and Professor Richard Green, a major contributor is insecure property rights — specifically, very strict rent control regulations and an inadequate supply of judges to rule in tenant eviction cases. We discuss how policies that increase risk and reduce profits — beyond a certain point, anyway — can lead some landlords to keep their units vacant rather than rent them out, with negative consequences for the entire housing market. We also explore the differences between “first generation” and “second generation” rent controls, and the reasons many cities across the world have shifted from the former to the latter.

Show notes:

Gandhi, S., Green, R. K., & Patranabis, S. (2022). Insecure property rights and the housing market: Explaining India’s housing vacancy paradox. Journal of Urban Economics, 131, 103490.
Tandel, V., Patel, S., Gandhi, S., Pethe, A., & Agarwal, K. (2016). Decline of rental housing in India: The case of Mumbai. Environment and Urbanization, 28(1), 259-274.
Diamond, R., McQuade, T., & Qian, F. (2019). The effects of rent control expansion on tenants, landlords, and inequality: Evidence from San Francisco. American Economic Review, 109(9), 3365-94.
Phillips, S. (2020). Does the Los Angeles region have too many vacant homes? UCLA Lewis Center for Regional Policy Studies.
Arnott, R. (1995). Time for revisionism on rent control? Journal of economic perspectives, 9(1), 99-120.
Sims, D. P. (2007). Out of control: What can we learn from the end of Massachusetts rent control? Journal of Urban Economics, 61(1), 129-151.
Another conversation on video between Sahil Gandhi and Paavo Monkkonen on rent control in India (click the tab “India: Rent Control” on the left).

Show notes:

Gandhi, S., Green, R. K., & Patranabis, S. (2022). Insecure property rights and the housing market: Explaining India’s housing vacancy paradox. Journal of Urban Economics, 131, 103490.
Tandel, V., Patel, S., Gandhi, S., Pethe, A., & Agarwal, K. (2016). Decline of rental housing in India: The case of Mumbai. Environment and Urbanization, 28(1), 259-274.
Diamond, R., McQuade, T., & Qian, F. (2019). The effects of rent control expansion on tenants, landlords, and inequality: Evidence from San Francisco. American Economic Review, 109(9), 3365-94.
Phillips, S. (2020). Does the Los Angeles region have too many vacant homes? UCLA Lewis Center for Regional Policy Studies.
Arnott, R. (1995). Time for revisionism on rent control? Journal of economic perspectives, 9(1), 99-120.
Sims, D. P. (2007). Out of control: What can we learn from the end of Massachusetts rent control? Journal of Urban Economics, 61(1), 129-151.
Another conversation on video between Sahil Gandhi and Paavo Monkkonen on rent control in India (click the tab “India: Rent Control” on the left).

Previous Episode

Ep 35: Landlord Regulation and Unintended Consequences with Meredith Greif

How do we respond when regulations intended to help vulnerable tenants end up disadvantaging them even further? Professor Meredith Greif joins us to discuss her research and new book, Collateral Damages: Landlords and the Urban Housing Crisis, which explores how penalties levied against landlords can lead to stricter screening, harassment, and informal eviction of renters who may already struggle to find adequate housing. Far from proposing that we do away with tenant protections, Greif asks us to consider the trade-offs inherent in many policy decisions. Before we can come up with better solutions, we first need to grapple with these unintended (but often predictable) consequences — and recognize how our policies and regulations may be producing exactly the behaviors we say we want to discourage.
Show notes:

Greif, M. (2018). Regulating landlords: Unintended consequences for poor tenants. City & Community, 17(3), 658-674.
Greif, M. (2022). Collateral Damages: Landlords and the Urban Housing Crisis. Russell Sage Foundation.
Background on the expansion of criminal nuisance laws and their disparate racial impacts in California: Dillon, L., Poston, B., & Barajas, J. (Nov 19 2020). Black and Latino renters face eviction, exclusion amid police crackdowns in California. Los Angeles Times.
Mead, J., Hatch, M., Tighe, J. R., Pappas, M., Andrasik, K., & Bonham, E. (2017). Who is a nuisance? Criminal activity nuisance ordinances in Ohio.
Desmond, M. (2016). Evicted: Poverty and profit in the American city. Crown.
Our earlier episode on landlords with Eva Rosen and Philip Garboden.

Next Episode

Ep 37: Public Housing and Tenant Power in Atlanta with Akira Drake Rodriguez

In this episode we do a deep dive into the history of Atlanta’s public housing program, from its inception in 1934 to the eventual demolition and redevelopment of many sites in the 1990s and onward. But Professor Akira Drake Rodriguez’s focus isn’t the public housing developments themselves. Rather, it’s on the tenants — overwhelming Black, and disproportionately women-led — who called public housing communities home, organized and built political power within them, and used that power to make demands of the government. It’s a complex history without clear or consistent “good guys” and “bad guys,” and it complicates the narrative which argues that housing vouchers (or “Section 8”) are a complete substitute for the decline in public housing across the country. Whatever your connection to Atlanta or your knowledge of the US public housing program, there’s a lot to be learned from this case study on the politics of public housing in Atlanta.

Show notes:

Rodriguez, A. D. (2021). Diverging Space for Deviants: The Politics of Atlanta's Public Housing. University of Georgia Press.
Pritchett, W. E. (2010). Robert Clifton Weaver and the American City: The Life and Times of an Urban Reformer. University of Chicago Press.
Parson, D. C. (2005). Making a Better World: Public Housing, the Red Scare, and the Direction of Modern Los Angeles. University of Minnesota Press.
The Pruitt-Igoe Myth (documentary).
Ingram, H., Schneider, A. L., & DeLeon, P. (2019). Social Construction and Policy Design. In Theories of the Policy Process (pp. 93-126). Routledge.
W. E. B. Du Bois: A Study of the Atlanta University Federal Housing Area, 1934.
Chaskin, R. J., & Joseph, M. L. (2015). Contested space: Design principles and regulatory regimes in mixed-income communities in Chicago. The Annals of the American Academy of Political and Social Science, 660(1), 136-154.
70 Acres in Chicago: Cabrini Green (documentary).

UCLA Housing Voice - Ep 36: Rent Control in India with Sahil Gandhi and Richard Green

Transcript

Shane Phillips 0:04
Hello, this is the UCLA housing voice podcast, and I'm your host, Shane Phillips. This week's guests are Sahil Gandhi of the University of Manchester and Richard Green of University of Southern California, and they joined us to talk about their research on a problem facing many Indian cities - a somewhat unusual combination of high vacancy rates and high rents. Under normal circumstances, high vacancy rates would predict low rents, but that relationship breaks down here