Implementing Rent Control And how it can help our citizens live better lives By: Queen Mirellia Q. Melromarc Rent Control in Melromarc’s Capitol 01 Rent Control in Classical Economic Theory 02 Reality of Rent Control in other cities 03 Rent Control Implementation in Melromarc’s Capitol Preface I would like to start by stating that the rental crisis in the city is partially my fault. While I was away, it became clear to me that my husband, Aultcray Melromarc XXXII and my daughter, first princess Malty Melromarc, were abusing their temporary power, unilaterally passing laws, perverting the Three Hero’s Church, raising taxes, and making false accusations against The Shield Hero, Naofumi Iwatani. They both have since been put on trial, and summarily punished for their actions. This does not, however, undo all the harm they have caused. With the approval of this Council, I would like to put forth this idea of rent control, in order to help our citizens by getting roofs back over their head, so they, in turn, can be more productive citizens of Melromarc. ** For the purpose of this report, as it is set in a fantasy world which does not use our currency I am making the following assumptions: 1 copper = $0.001 CAD. In this world, 100 copper = 1 silver, and 100 silver = 1 gold** Also, the setting is analogous to medieval times, which means that while nothing changes about classical economic theory, it does change how things would play out in “reality” – in terms of jobs, wages, taxes, and government. While Queen Mirelia Q Melromarc could unilaterally pass rent control, the purpose of the project was to write a report for the council to approve. Not to mention that it would be a good thing for a ruler to have the support of some kind of council before enacting something into law. I have also taken liberties in the currency conversion in our world, just based on what I know from watching the series, how much food costs, how much one night at an Inn is in a small town, 01 – Rent Control in Classical Economic Theory In classical economics, rent control is synonymous with a price ceiling. When a price ceiling is put below equilibrium, things get off balance. Quantity supplied goes down, quantity demanded goes up, and thus, there is now a shortage. The concern here is that landlords will no longer be able to maintain properties that they do have effectively, without the extra income. This may even cause some landlords to start dealing in illegal properties, meaning that tenants will no longer have the protections and the rights they currently enjoy under our leadership. Due to possible shortages, this may mean that homelessness could increase. It could also mean that citizens could be driven out of the capital (DornerA, 2016, paras.1-9). While this can sound terrifying, theory is not synonymous with reality. 02 – Reality of Rent Control Currently, in Lurolona Village Sir Naofumi has put forth rent control for all of its citizens. Since the village was completely destroyed during the first Wave of Catastrophe, it needs extensive rebuilding. While this would seem like the least likely candidate for rent control, things have been going surprisingly well there. With rent control in the village, residents have been able to focus on helping restore the rest of the village, instead of spending the majority of their time and energy working just so they have a place to call home. As a result, progress in the village has been moving at an unprecedented rate! The rent on a 2-bedroom unit in Lurolona is only 30 silver a month. Therefore, they don’t have to be working every day of the month in order to just have a roof over their head. Villagers and employers also get a break in their taxes as long as there is documented progress that they are helping to restore the village to its former glory. 03- Rent Control Implementation in Melromarc’s Capitol At the current cost of 180 silver coins a month for a 2 bedroom, our citizens are spending on average around 88% of their monthly income on rent. In the long run, this is going to be nothing but detrimental to our economy. Most of our citizens have modest jobs, like being a grocer, baker, or blacksmith. On average, a full-time worker earns about 5 silver a day. Since this would not be enough to cover rent (even if they never had a day off), the second adult in the household, or even one of their children, would have to at least work part-time, which would net about 75 silver coins a month. Therefore, most families are living in one-bedroom units, and individuals are living on the streets. The disparity in income, and the high rent means that land and business owners keep gaining more wealth, while the average citizen is struggling to make ends meet. As the ruler of these lands, I cannot stand by and watch this happen any longer. Therefore, I would like to propose we set the following limits: - Room to rent: 3 silver a night, 15 silver per week, and 30 silver per month. - 1 Bedroom unit: 35 silver per month - 2 Bedroom unit: 50 silver per month While it may seem like a dramatic decrease in revenue, I do know that most of you are not only landlords, but business owners as well. While it may hurt your landholdings in the short term, overall, you will see this balance out with increases in business revenues, as the residents will now have more money to spend on local goods and services. Conclusion Overall, there are many benefits for rent control to all the citizens of Melromarc. It will start enabling families to occupy larger units and get our citizens off of the streets. Once citizens are housed, they will be able to work, which is going to be beneficial to Melromarc’s economy in the long run (Julia von Wurden, 2018, para.6). In turn, this will also help decrease crime rates in the capital, leading to less loss for businesses as well (New Dawn Enterprises, 2023, p. 6). Should this motion go through at our next meeting, I am willing to offer a tax break to all, in order to help offset related costs of maintaining the units to the high standard to which Melromarc is known for (Richardson, 2023, para. 9). Please know that it will only take a 60% majority vote in order for the policy to be enacted, References Compton, J. 2019, August 9. The Rising of the Shield Hero: The rise of a mercantilist. Medium. https://medium.com/itinerant-thoughts/the-rising-of-the-shield-hero-the-rise-of-a-mercantilistc51ade01c57 DornerA. 2016, March 30. What are the economic ramifications of rent control?. Economics Stack Exchange. https://economics.stackexchange.com/questions/11304/what-are-the-economicramifications-of-rent-control Julia von Wurden, C. 2018, May 1. The impact of homelessness on economic competitiveness. American Security Project. https://www.americansecurityproject.org/impact-homelessnesseconomic-competitiveness/ New Dawn Enterprises. 2024, January 29. Housing as public safety whitepaper. https://newdawn.ca/wp-content/uploads/Housing-as-Public-Safety-Whitepaper.pdf Richardson, B. 2023, March 23. The pros and cons of rent control for landlords and tenants. Forbes. https://www.forbes.com/sites/brendarichardson/2023/03/23/national-apartment-associationstudy-finds-that-rent-control-is-not-the-solution-it-appears-to-be/
