These are usually worth pondering, as at the very least you will learn something. Here is a hate-worthy paragraph from an earlier Bloomberg column of mine:
…note that higher real estate prices, to the extent they result from immigrant demands, largely translate into capital gains for homeowners — most of whom are native-born. To be sure, the higher home prices may be bad for many younger Canadians, who may be locked out of housing markets, but eventually many of them will inherit high-valued homes from their parents.
Yet it is true. “Immigrants pushing up home prices” should not be a major worry, though it does create some distributional problems (is this the main way to induce conservatives to worry about distributional problems?).
With some effort maybe one can make the dislike of the argument stronger. Often I hear “Oh, it’s good if we taken in lots of immigrants. But the more that come, the more we need YIMBY to house them at reasonable expense.”
Maybe! But let’s not forget the terms of trade models for international exchanges. If one of our export industries is “selling homes to arriving foreigners,” you might want your sellers to collude, restrict output, and raise prices to the foreigners. At least if you are maximizing the welfare of initial natives.
And that is precisely what NIMBY policies do, namely by enforcing a kind of implicit collusion, they force the arrivals to pay more for homes. Pay more to the natives, that is.
Raise your hand if you’re against capital gains!
Of course the cosmopolitans amongst us can resolve these issues rather easily.
