September 22, 2006
A half-dozen economists working locally, in California and across the country, say it is unlikely that the plan would have not repercussions. Basic economic theory indicates that any restriction on the supply of any good inevitably increases the price of that good in the face of consistent demand.
"If you make things scarce, they are going to be more expensive," says Raphael Bostic, director of the master's program in real estate development at the University of Southern California and a former staff member at the Federal Reserve Board of Governors. "That is not to say that there are no benefits to having open space, but there are clearly costs."