Most US cities have zoning laws that restrict a property owner's use of his or her property

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Most US cities have zoning laws that restrict a property owner's use of his or her property in some way. For example, in a neighborhood that is zoned for "single family houses only." the owner cannot build a separate entrance and rent part of the house to tenants, nor can anyone set up a business, e.g., a small grocery, in that neighborhood, even though any given home owner could increase the value of his or her property by so doing. Using a "game theory" approach, explain why these restrictions in property usage can nonetheless increase the value of the property in a neighborhood (which would explain why these zoning laws are so frequently enacted).

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Principles Of Microeconomics

ISBN: 9780812224177

1st Edition

Authors: Eugene Silberberg And Gregory Ellis

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