From: Paul Cockshott (wpc@DCS.GLA.AC.UK)
Date: Sun Dec 25 2005 - 16:36:33 EST
Jurrian wrote: So anyway, as you can see, just as with business enterprises, if more people *own* homes rather than *rent* them, official total productivity measures increase, and official total net output and GDP goes up. Yeah, you can say OOH!! Why should that be the case. Surely a shift from rented to owner occupied properties will be reflected in a fall in actual rents and a compensating rise in imputed rents. The rise in rent, imputed or actual, would tend to reflect the increasing significance of monopolized property in urban land. The difference between the capitalized price of houses and their construction costs reflects the capitalized rent that could be obtained from the houses. Since urban land is finite its price rises as a consequence of general capital accumulation. Imputed rent may be imaginary, but its capitalization definitely is not - at least from the standpoint of individual agents who can trade in their city center properties for shares and other capital assets. It would be interesting to analyse what real value flows are associated with it in the form of flows into and out of savings and loan institutions.
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