Reviving Adam Smith

roof top laundry in social housing
State Housing, New Zealand photo by Archives New Zealand is licensed under CC BY 2.0
New Zealand Social housing - a remedy for profit taking in the housing market.

A researcher at University College London draws attention to Adam Smith’s theory of economic rent. Smith is widely known as the the father of free market economics. The theory of economic rent provided Smith the means to speak about the surpluses that landlords extracted from their property and the detrimental effects of those surpluses for other members of society.

Jenny McArthur makes this observation in her highly readable report that discusses the public policies that fuel high housing prices, and identifies who benefits and who doesn’t. She recommends a series of truly thought-provoking policy changes to control the level of profit that can be extracted. Her prescription also features a non-market housing program to ensure that people who are homeless and people with very low incomes have access to decent, affordable housing.

For more, see at the Helen Clark Foundation: Somewhere To Live