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THE DISTRIBUTIONAL IMPACT OF RESTRICTIVE RENT CONTROL PROGRAMS IN BERKELEY AND SANTA MONICA, CALIFORNIA

JUNE 1993

 

This paper reports on research using 1980 and 1990 Census data to examine the demographic impacts of the restrictive rent control programs in effect in Berkeley and Santa Monica, California throughout the 1980's. The 1980 - 1990 Census decade coincides with the first decade of these two fundamentally similar programs, allowing meaningful analysis of the effects of restrictive rent control (in combination with other "progressive" housing programs) on rental housing and vulnerable population subgroups. Relevant demographic variables are examined for each city, for the surrounding counties, the surrounding SMSAs, for the State, and for ten comparably-sized northern California cities and ten comparably-sized cities in Southern California. The study demonstrates that these programs were associated with a reduction in the stock of rental housing of more than 10% in Berkeley and Santa Monica over the decade. There were also major reductions in the numbers of some of the same subgroups targeted for assistance by "progressive" housing policies: low income households, college students, elderly persons, families with children, and disabled persons. Tight and shrinking housing markets seem to favor economically advantaged individuals and households. The evidence suggests that a public choice model characterizing rent control (along with growth control, down-zoning, "neighborhood preservation", eviction control, blight control , and other "progressive" housing programs) as an exclusionary program promoting accelerated "gentrification" of host communities may be correct.

 

Michael St. John, PH. D.

 

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