On The Economic Effects of Rent Control in Denmark

From the point of view of economics the most important feature of houses is their exceptional durability in consequence of which the annual addition of new apartments or houses amounts to only a few per cent of the total stock. In most countries at most times the annual growth amounted to only some one to three per cent of the physical stock. Though these figures underestimate the economically relevant rate of growth by ignoring changes in quality, it is obvious that in periods of rapidly rising aggregate real income a housing shortage in the sense of increasing relative scarcity of house room is apt to arise.