Your friend’s argument is basically the opposite of Georgian economics. It is a set of policies that maximizes land speculation at the expense of capital investment and even rent seeking. If you want to maximize value for incumbents then restrict construction without establishing rent controls. If you want to keep rents accessible to an influx of poor people then allow construction. You cannot provide housing for an influx of residents while restricting construction. There won’t be enough living space to go around. The only way to provide sufficient housing while keeping prices low is to restrict immigration, which San Francisco lacks the sovereignty to do.
Every country wants their own Silicon Valley. Few have succeeded in creating one. Building new hubs is hard because there are massive network effects. In theory, it is possible. (Many countries have built massive industrial sectors via government-led industrial policy.) The problem is that centralized decision-makers are bad at urban planning in general and bad at building startup hubs in particular .
Your friend’s argument is basically the opposite of Georgian economics. It is a set of policies that maximizes land speculation at the expense of capital investment and even rent seeking. If you want to maximize value for incumbents then restrict construction without establishing rent controls. If you want to keep rents accessible to an influx of poor people then allow construction. You cannot provide housing for an influx of residents while restricting construction. There won’t be enough living space to go around. The only way to provide sufficient housing while keeping prices low is to restrict immigration, which San Francisco lacks the sovereignty to do.
Every country wants their own Silicon Valley. Few have succeeded in creating one. Building new hubs is hard because there are massive network effects. In theory, it is possible. (Many countries have built massive industrial sectors via government-led industrial policy.) The problem is that centralized decision-makers are bad at urban planning in general and bad at building startup hubs in particular .