Control create an inefficient allocation of resources

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Reference no: EM13798009

Why does rent control create an inefficient allocation of resources?

The existing apartments are not necessarily allocated to those tenants who value them most.

Apartments sit vacant for long periods of time due to rent controls.

Too many resources are devoted to building new apartments to meet the scarcity of apartments.

Landlords will spend more effort than is necessary to maintain the quality of rent-controlled apartments.

Reference no: EM13798009

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