Why Supply & Demand Theory Doesn't Apply in High-Value Land Markets like Arlington, VA
Professor Jay Cochran, Adjunct Professor of Economics at George Mason University analyzes law of SUPPLY & DEMAND and how the theory does not hold up in high-land value markets, like Arlington.
Cover of the economics study "Why Supply & Demand Theory Breaks in High-Value Land Markets: Arlington, VA"
“Using zoning to fight all the market forces described above is a fool’s errand. It would be like using a Toyota Corolla to haul a 5-ton trailer: It might get you down the road a bit, but it won’t get you far.”
“Arlington’s policy of Multiplying by Dividing achieves any ‘successes’ that it does only by in essence taking the value of the surrounding neighbors’ properties through increased spillover costs and lowered individual property values.”
“In short, the house price and supply problems in Arlington largely, though not entirely, trace to macroeconomic policies that are beyond the County’s control.”