A Housing Market with Cournot Competition and a Third Housing Sector

Trond-Arne Borgersen ()
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Trond-Arne Borgersen: Østfold University College

International Journal of Economic Sciences, 2022, vol. 11, issue 2, 13-27

Abstract: This paper integrates a non-profit third-housing sector (THS) into a housing market with Cournot competition. The paper analyses the indirect effects of a THS on the aggregate housing market, on a commercial housing supplier and on the market adaption of households not embraced by the THS. While beneficial for households included in the THS, a question arises related to the indirect effects of a THS. The paper argues for crowding-out and higher house prices in the commercial housing market in response to a THS expansion. In addition, a THS also affects the strategic behaviour of the commercial housing supplier. Compared to a conventional Cournot housing market, a fixed THS housing supply changes the market structure from one where the housing supply of different housing providers are alternative to one-another, to a market structure where housing supply is complementary.

Keywords: Housing market; Cournot competition; Third Housing Sector; Indirect effects. (search for similar items in EconPapers)
JEL-codes: R21 R31 (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:aop:jijoes:v:11:y:2022:i:2:p:13-27

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