What Happens When Government Subsidizes Demand but Restricts Supply?
Give every buyer $100,000 when there are still only ten houses, and the check goes to the buyer while the money goes to the seller. How much depends on one thing: supply.
Zesht principle
Competition is information
People leaving a store, school district, insurer, city or product is itself information. Choice creates feedback. Systems that prevent exit can also suppress that feedback.
Why Drive an Hour to Buy a Handbag?
From October 1, Los Angeles charges 10.25% sales tax and Irvine charges 7.75%. The legal saving on a luxury purchase may be zero. The shopping still moves.
California Tried to Control Insurance Prices. What Happens When Insurers Stop Selling Insurance?
You can control the premium. You cannot control the risk. When the allowed price doesn't cover the risk, the response isn't cheaper insurance — it's no insurance.
Did Student Loans Make College More Expensive?
The easy version says loans caused expensive college. The evidence says something more specific — and more useful: schools capture aid where buyers stop comparing prices.
What If Education Money Followed the Student?
California already pays schools per student — with a lag for districts and a catch for wealthy ones. We compared LAUSD, Irvine, Beverly Hills, Santa Monica-Malibu and three charter networks.
The rest of the framework
Other principles
People respond to incentives
Change the cost or reward attached to an action and people change their behavior.
Every subsidy has an incidence
Someone receives the benefit, someone finances it, and sometimes a producer captures it.