Comment Comment by oDot You write as if markets are a zero sum game, however they are most certainly not.You say the poor tenant will transfer wealth to the wealthy landlord as if the tenant is losing. However -- they are both gaining.Say the rent is $1000.Obviously, the property usage right is worth to the landlord less than $1000, otherwise he would've just used the property himself. He gains.The property usage right is worth more than $1000 to the tenant, otherwise he would've just kept the money. He gains.Both people gain. Both people get richer. Both people ended up with more than they had prior to the transaction. parent oDot 6 years ago
You say the poor tenant will transfer wealth to the wealthy landlord as if the tenant is losing. However -- they are both gaining.
Say the rent is $1000.
Obviously, the property usage right is worth to the landlord less than $1000, otherwise he would've just used the property himself. He gains.
The property usage right is worth more than $1000 to the tenant, otherwise he would've just kept the money. He gains.
Both people gain. Both people get richer. Both people ended up with more than they had prior to the transaction.