Effects of quality changes in rental housing markets with indivisibilities

To link to full-text access for this article, visit this link: http://dx.doi.org/10.1016/j.regsciurbeco.2007.01.002 Byline: Tamon Ito Keywords: Rental housing market; Comparative statics; Rent equation; Differential rent; Quality improvement Abstract: This paper presents comparative statics results on a rental housing market model with a finite number of apartments. The apartments are classified into categories based on their housing attributes. The apartments in a given category are treated as equals having the same rent. The main result is that when an improvement occurs in one category, the rent of the category increases, whereas rents of better categories decrease. We compare this result with another comparative statics result, and also with Braid's results in his model with a continuum of housing qualities. Author Affiliation: Institute of Policy and Planning Sciences, University of Tsukuba, Ibaraki 305-8573, Japan Article History: Received 21 February 2005; Revised 30 November 2006; Accepted 15 January 2007