Tyler Cowen: belief

Transcript context

…Oh, are those not the same thing? Well, they’re interrelated, but let’s say there’s no NIMBY. Like Seoul, South Korea — they’ve built an enormous amount. It’s a very vertical city. It has like a third of the country’s GDP, but it’s still very expensive to live there. You can’t say they’re too NIMBY, but it’s worth a lot to be in Seoul. Busan is important, but there’s nothing really close to being in the economic, financial, and cultural center. At least in Korea, it seems it’s about co-location and not about NIMBY. But if it’s Oakland, California, I suspect it’s mostly about NIMBY. NIMBY Berkeley. Yes, I would say definitely in some areas, it’s about NIMBY. It’s people really trying to protect the value of their home and the value of what they perceive their surroundings to be, and they don’t want any change ever. I think some components of it are definitely people being resistant to any idea of progress. Then I think a lot of it, too, is just we haven’t built enough. I interviewed the deputy secretary of the Treasury about the housing crisis, and yes, it’s a problem that we’ve had since the Great Recession. Home builders got freaked out when the housing market crashed, so of course, they’re not going to build. Now rates are really high, so it’s even harder to build. We’ve had all these zoning restrictions, and we just make it really hard to build, too. I think it’s this perfect storm of events. Then also, a house is meant to be both a speculative asset and a place that you live. There’s one of my favorite charts from the Fed. I talk about it all the time because it’s a distribution of financial assets. It shows the bottom 50 percent — all their wealth is tied up in housing. If you say to those people, “We’re going to build around you and potentially reduce the value of your home,” they’re not going to be so happy about that. There are studies showing that building more doesn’t reduce the value of a home, but I think you’re fighting an uphill battle with housing because we tell people that this is the ticket to the American dream, and then also just don’t have enough of it because of that.…

Stored transcript either side of the excerpt. The highlighted words are the published quote; the surrounding text is unedited source, never generated.