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Rent Control Dilemma Comeback in Egypt’s Governance: A Hedonic Approach

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  • Shereen Attia

    (British University in Egypt)

Abstract

This paper applies hedonic pricing models to estimate the relationship between housing prices and characteristics and determines the implicit amount of housing consumed by a typical consumer by tenure type. The hedonic price approach is used to set up quality-adjusted price indices using household survey data. By estimating a semi-log hedonic function, the results showed that uncontrolled rent is higher on average than controlled units by around 9 percent after controlling for quality, while about 18 percent of the discrepancy in nominal rents is due to the fact that rent control is in effect. Therefore, the underpriced units drive out affordable units because of over-pricing at the higher end of the market and underpricing at the lower end of the market.

Suggested Citation

  • Shereen Attia, 2016. "Rent Control Dilemma Comeback in Egypt’s Governance: A Hedonic Approach," Working Papers 979, Economic Research Forum, revised Feb 2016.
    • Handle: RePEc:erg:wpaper:979
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    1. Ault Richard W. & Jackson John D. & Saba Richard P., 1994. "The Effect of Long-Term Rent Control on Tenant Mobility," Journal of Urban Economics, Elsevier, vol. 35(2), pages 140-158, March.
    2. Gyourko, Joseph & Linneman, Peter, 1989. "Equity and efficiency aspects of rent control: An empirical study of New York City," Journal of Urban Economics, Elsevier, vol. 26(1), pages 54-74, July.
    3. Malpezzi, Stephen, 1998. "Welfare analysis of rent control with side payments: a natural experiment in Cairo, Egypt1," Regional Science and Urban Economics, Elsevier, vol. 28(6), pages 773-795, November.
    4. Olsen, Edgar O, 1972. "An Econometric Analysis of Rent Control," Journal of Political Economy, University of Chicago Press, vol. 80(6), pages 1081-1100, Nov.-Dec..
    5. Munch, Jakob Roland & Svarer, Michael, 2002. "Rent control and tenancy duration," Journal of Urban Economics, Elsevier, vol. 52(3), pages 542-560, November.
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    Cited by:

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    2. Konstantin A. Kholodilin, 2018. "Measuring Stick-Style Housing Policies: a Multi-Country Longitudinal Database of Governmental Regulations," Discussion Papers of DIW Berlin 1727, DIW Berlin, German Institute for Economic Research.

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