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0 pointsTJSomething2y ago0 comments

The thing about monopolies is that the monopolist still has to deal with the demand curve, but they get to set the supply curve. As price goes up, demand goes down; they can't change this. In healthy markets, when supply goes up, prices go down because of competition. Then the price ends up at the intersection of the two curves.

The monopolist doesn't have to follow this rule: they set the price to whatever makes the most profits and leave the price there regardless of fluctuations in housing supply.

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davidw2y ago· 1 in thread

I think it's highly unlikely that they're a true monopoly. Housing is just too fragmented a market. There are too many people willing to defect, too many mom and pop shops, and of course you have other cities that people can move to if they just can't handle the prices.

connicpu2y ago

Housing is inelastic enough that they don't need a 100% monopoly to engage in highly monopolistic practices. The article mentions that about 80% of rentals in Atlanta are using algorithmic pricing, and 80-90% of landlords are following their recommendations as is. If the algorithm is laundering their collusion onto 64-72% of the housing market, that's larger than plenty of monopolies that have been broken up in the past.

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