Forbes: The “Meteoric Rise” Of Confusion About Housing Economics

Forbes: The “Meteoric Rise” Of Confusion About Housing Economics
May 14, 2018 Peter

Two things struck me about a recent CNN story following controversy over the tax on jobs in Seattle that many want targeted at Amazon. First, was the headline. Meteors don’t rise, they fall. The other was the ease with which today’s folk economics (something I’ve compressed into the term, ‘folkenomics’) has penetrated every level of the discussion about housing in the United States. You see, according to folkenomics, companies like Amazon come to a town bringing jobs which then cause “meteoric rises” in prices. There is a correlation, they say, between the arrival of a company like Amazon rising prices. Watch out cities, they say, you’re likely to have the same thing happen if Amazon choses you for HQ2. Maybe ordinary people and even politicians could be excused for confusing correlation with causation.

 

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