Housing supply is one of the most misunderstood processes in economics. The reason for this is that the core standard theory of economics is a static one-period model of production with a fixed capital endowment. They confuse the optimal density of dwellings, given the fixed capital of one unit of land, with the optimal rate of supply of new dwellings per period of time.
A housing absorption rate formula—first cut
A housing absorption rate formula—first cut
A housing absorption rate formula—first cut
Housing supply is one of the most misunderstood processes in economics. The reason for this is that the core standard theory of economics is a static one-period model of production with a fixed capital endowment. They confuse the optimal density of dwellings, given the fixed capital of one unit of land, with the optimal rate of supply of new dwellings per period of time.