Information Asymmetry, Regulations, and Equilibrium Outcomes: Theory and Evidence from the Housing Rental Market

46 Pages Posted: 12 Oct 2016 Last revised: 1 Jul 2018

See all articles by Brent W. Ambrose

Brent W. Ambrose

Pennsylvania State University

Moussa Diop

University of Southern California

Date Written: January 22, 2018

Abstract

Housing affordability in the United States is a perennial concern. We explore the role of information asymmetry and regulations on equilibrium outcomes in rental markets to show that while landlords price the cost of regulations into rent, they also invest in tenant screening to alleviate information asymmetry, thus restricting access to rental housing. We are the first to document this additional tenant screening in response to regulations.

Keywords: Rental Market, Landlord Regulations, Information Asymmetry, Tenant Screening, Affordable Housing

JEL Classification: G0, G13, G18, G28, R3, R31, R38

Suggested Citation

Ambrose, Brent W. and Diop, Moussa, Information Asymmetry, Regulations, and Equilibrium Outcomes: Theory and Evidence from the Housing Rental Market (January 22, 2018). Available at SSRN: https://ssrn.com/abstract=2851156 or http://dx.doi.org/10.2139/ssrn.2851156

Brent W. Ambrose

Pennsylvania State University ( email )

University Park, PA 16802-3306
United States
814-867-0066 (Phone)
814-865-6284 (Fax)

Moussa Diop (Contact Author)

University of Southern California ( email )

Sol Price School of Public Policy
RGL 315
Los Angeles, CA 90089
United States
(213)821-0467 (Phone)

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