May 5, 2020, 4:25 PM
(repost)
(a) as density increases opportunity cost decreases.
(b) as opportunity cost decreases, rents and mortgages increase to absorb the decrease in opportunity costs
(c) as rents and mortgages increase, salaries and wages increase to offset the capture of opportunity costs.
(d) as wages and salaries increase, the price of goods services and information increases to the point of equilibrium.
(e) this cycle repeats until the prices of goods, services, and information, can no longer compete at which point companies must draw from capital markets, and government intervention in availability, price and subsidy
(f) as in all organizations of all scales, rent-seeking (free riding) increases in government, capital markets, subsidies to the point of exhaustion.
(g) until a shock occurs, and there is insufficient uncaptured capital to reorganize the social, financial, economic, and political order.
(h) whereby the tax paying class (who can afford to) flees, the city falls into decline, and then experiences a population collapse due to accumulated rents.
(h) whereby either genetrification or depopulation ensues, which is entirely epenent upon (i) existing demographics, and ii) existing location.
THE WEST IS DYING ONE CITY AT A TIME
Primary culprit in every city’s case? Pensions.