TECH Signal 592 2 feeds carried it
NIMBY opposition to housing deregulation ignores offsetting consumer surplus from cheaper housing
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Bryan Caplan argues that capital losses from progress often come with offsetting consumer surplus gains, using his CD collection's collapse in value under streaming as an analogy for homeowners opposing housing deregulation.
The argument reframes who actually benefits from housing deregulation: even homeowners who see property values drop may gain more in consumer surplus than they lose, especially if they ever move, travel, or have children who need housing. This matters for anyone arguing about the distributional effects of technological or regulatory change.
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Caplan's roughly 4,000 CDs cost about $40,000 to acquire but now retail for about $3 each, yet streaming gives him free access to far more music than he ever owned.
If housing deregulation halves a $1M home's value, the owner gains offsetting surplus: a $2M dream home becomes $1M, a $500k downgrade becomes $250k, and hotel and rental costs fall too.
The argument acknowledges that someone with zero desire for new music or new housing genuinely loses; the net gain depends on preferences and openness to substitution.
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