… but fails to draw the obvious conclusion.
From the NY Times, h/t Pablo:
In essence, they arrive at the sensible conclusion that cities are valuable because they facilitate human interactions, as people crammed into a few square miles exchange ideas and start collaborations.
“If you ask people why they move to the city, they always give the same reasons,” West says. “They’ve come to get a job or follow their friends or to be at the center of a scene. That’s why we pay the high rent. Cities are all about the people, not the infrastructure.”
Having established what creates rental value, why not ask whom it belongs to? To say it belongs to landowners is like saying that fireplaces give off heat. They don't. It's the burning fuel that gives off heat.
As an aside, this further undermines the view that particularly high rents and prices in London are caused by shortage of supply. They are not. They are caused by the presence of large numbers of people and businesses (and the appropriate infrastructure to support it).
If you build more buildings, will you get more people and businesses or fewer..? Continuing the fireplace analogy, you can't cool down a fire by throwing more dry twigs on it.
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