 The Impact of Inflation and Taxation on Tenure Choice and the Redistributive Effects of Home‐Mortgage Interest Rate ReguIation*Roslyn Anstie, Christopher Findlay and Ian Harper The Economic Record, 1983, vol. 59, issue 2, 105-110 Abstract: Judy Yates (1981) notes the regressive redistributive impact of home‐mortgage interest rate regulation and offers some explanations. This paper provides an alternative explanation of Yates' observations in terms of the interaction of inflation with the current tax system in Australia. A model of tenure choice in the context of inflation and taxation is developed. In explaining this phenomenon, the model also establishes the regressive nature of the tax subsidy to owner‐occupation. Home‐mortgage interest rate regulation is then introduced. This reinforces the redistributive bias in the housing finance market. The model is used finally to predict the impact of deregulation. It is concluded that deregulation by itself can only remove redistributive bias resulting from regulated mortgage interest rates. Reform of the tax system is required to eliminate the regressive redistributive effects of the tax subsidy to owner‐occupation. Date: 1983 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:bla:ecorec:v:59:y:1983:i:2:p:105-110 Ordering information: This journal article can be ordered from Access Statistics for this article The Economic Record is currently edited by Paul Miller, Glenn Otto and Martin Richardson More articles in The Economic Record from The Economic Society of Australia Contact information at EDIRC. |
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