Does Rent Regulation Affect Tenant Unemployment? Evidence from New York City

This paper examines the impact of rent regulation on tenants' unemployment in New York City. We provide evidence that rent stabilization increases tenants' unemployment by over five percentage points using data from 2002 and 2017. To address endogeneity concerns, we employ an instrumental variable strategy that exploits the local historical availability of rent-stabilized units when tenants move in as an exogenous source of variation for occupying a rent-stabilized unit. We also develop a job-search model to explain the underlying mechanisms of rent regulation's unemployment effects. Our findings underscore the need for policymakers to consider the unintended consequences of rent regulation.

Keywords: Rent Regulation, Rent Stabilization, Tenant Unemployment, Job Search Model, Policy Awareness, New York City

JEL Classification: H70, L51, R21, R28, J60

Suggested Citation: Suggested Citation

Jiang, Hanchen and Quintero, Luis and Yang, Xi, Does Rent Regulation Affect Tenant Unemployment? Evidence from New York City (March 1, 2022). Johns Hopkins Carey Business School Research Paper No. 22-04, Available at SSRN: https://ssrn.com/abstract=4034964 or http://dx.doi.org/10.2139/ssrn.4034964