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Housing Supply and Housing Affordability
The decline in housing affordability over recent decades has promoted an enhanced interest in housing supply. This chapter presents descriptive evidence about the evolution of us housing prices, quantities, and regulations since 1980, indicating that supply constraints appear to be increasingly binding. We then provide an overview of the various approaches used to model construction and land development for homogeneous and heterogeneous housing in static and dynamic contexts to understand housing supply. Our treatment incorporates empirical implementation and policy implications throughout. Finally, we provide an overview of quantitative evidence on the consequences of relaxing various types of supply constraints.
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