Nobody downloaded yet

Housing in a Free Market Economy - Essay Example

Comments (1) Cite this document
The government can intervene in housing sector by planning its role through various choices and taking certain measures. It can initiate a national homes saving scheme by facilitating first-time home buyers to use their tax-free 5-years period deposits. …
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER98.6% of users find it useful
Housing in a Free Market Economy
Read TextPreview

Extract of sample "Housing in a Free Market Economy"

Download file to see previous pages With the end of the housing blast of the past decade, the UK government under Gordon Brown wants to energise the housing sector of the economy. The government’s interference in housing and its authenticity in playing a role in the housing market through its policy initiatives is being seen doubtfully by experts as they perceive the ups and downs of the market functioning a part of the business cycle of regular intervals of boom and bust OR the government’s desire to meddle in the housing affairs just shows the obsession of the people to own a home of their own OR the government has started realising the importance of hosing market in the overall economy of the country, needs o be analysed (The Telegraph, 5 June 2008). The government can intervene in housing sector by planning its role through various choices and taking certain measures. It can initiate a national homes saving scheme by facilitating first-time home buyers to use their tax-free 5-years period deposits. It can allow parental help by making the contribution in the housing of their children tax-free. It can increase the stamp duty to a certain limit to minimise the impact to new buyers. The government can declare a stamp duty ‘holiday’ for a stipulated time to boost the housing market. It can loosen the regulatory grip so that home building activity becomes hyper. It can be lax in insisting on Home Information Packs, which are offered and paid by the sellers. The government can limit the number of ‘affordable homes’ on the upcoming housing locations to boost housing growth as house making is less profitable for making affordable homes (The Telegraph, 5 June 2008). Competition is very important in housing market to disrupt the rent-seeking tendencies by powerful builders. Rent seeking, laissez-faire and state intervention not only kills competition between the market forces but comes in the way of innovation. Government level intervention can bring about greater transparency in the housing transactions (Hooper, 2009). Arguments in Favour of Government Intervention in Housing Sloman and Sutcliffe (2004) state a number of reasons inviting government intervention in business. To fulfil the aim of social efficiency, which is attained when marginal benefits become equal to marginal costs from production or consumption activity, government can interfere in the specific business market. Response of market to changes in supply and demand may be slow, which can impair the level of equilibrium and cause instability. A free market does not consider the needs of less-affordable people and therefore, the production of merit goods could be insufficient. Market irregularities can be corrected through taxes and subsidies. Taxes can be increased to equal the size of the marginal external cost and offering subsidy equal to the marginal external advantage. The government can regulate the market behaviour by making certain laws to be abided by for the benefit of common man. These are some of the steps government can take to interfere in the market for any business activity. The current discussion on government role in housing market has gained momentum because of the global financial crisis, which has drawn the attention of policy makers in the UK government. It wants to rescue the housing and banking sector, as housing and finance are inter-related sectors; without getting loans sanctioned by the financial organisations, the home buyers cannot purchase houses and the housing industry cannot attain growth. On its part, the British government through the Bank of England made $352 billion available via the Special Liquidity Scheme to enhance the ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
(“Housing in a Free Market Economy Essay Example | Topics and Well Written Essays - 3000 words”, n.d.)
Retrieved from
(Housing in a Free Market Economy Essay Example | Topics and Well Written Essays - 3000 Words)
“Housing in a Free Market Economy Essay Example | Topics and Well Written Essays - 3000 Words”, n.d.
  • Cited: 0 times
Comments (1)
Click to create a comment or rate a document
vernieortiz added comment 8 months ago
Student rated this paper as
I had an issue with a essay types of works. All until I came across this website and this particular document. Even though "Housing in a Free Market Economy" is far from my interests, the structure is so great that I use it all the time as an example for my own works.

CHECK THESE SAMPLES OF Housing in a Free Market Economy

Free Market Economy

...?The term free market economy mainly means a system where land and capital are privately owned and the buyers and sellers are solely responsible for all economic decisions. The free market economy is usually associated with a pure capitalist system where prices influence the allocation of goods and services. In this kind of market, importance is placed on the freedom of the consumer and the worker, and the firm itself. The fact that a free market economy operates automatically is one of its major advantages. Moreover, when firms, consumers and workers pursue their own self interest through buying and selling in competitive markets, it helps in minimizing the central economic problem of scarcity, by encouraging the efficient use... of...
5 Pages(1250 words)Essay

Free Market Economy

...forward by Adam Smith in light of the free market economy. Arguably, in words of Adam smith, free market system supports growth of monopolies, cartel-type activities and mergers. Free market, in this respect, is an economic system in which prices, wages etc are controlled by supply and demand rather than government. It is in total contrast of controlled market in which the government indirectly or directly controls demand, supply or prices. Whether Adams Smith is right or not, remains the subject of this discussion. Gregory and Stuart (2003) note that free market system...
12 Pages(3000 words)Research Paper

Free Market

...?ECON 2022-007  Spring Dr.Martin Sabe  Free Market Economic equality and freedom is still a dream of several nations of this world. Poverty and want are still bothering the societies to a great extent. It is high time to find and follow the best economy policy for the economy of the nations. It has been highly controversial whether free market is suitable for the present world economy. It is still unknown which economic policy would solve the fundamental economic problems of the present economy. It is time to analyze whether the concept of mixed economy would find success in this present world. It is again controversial up to what extent the governmental regulation must be allowed in a mixed economy. Moreover, it is also important... to...
4 Pages(1000 words)Essay

The Housing Market Bubble Burst

...? The Year That the Housing Market Bubble Burst: And Could It Happen Again Why Did the Housing Market Bubble Burst In 2006 The real e price kepton rising for more than a decade until 2006. The reasons were many and varied. The phenomenon can better be understood from the demand supply perspective. Source: The cost of housing or for that matter for any commodity solely depends upon the demand-supply dynamics if it is allowed to operate in a free market without any government intervention. Housing demand was in upswing since January, 1993. The median...
3 Pages(750 words)Research Paper

Free Market Economy and Financial Crisis

...not stir the economy enough to cause economists to develop a well descriptive recession model. With no major recessions over a long time, the economists tend to believe that the crisis may not happen. The model derived by free market economists was running a healthy economy from 80s to 2008 making economists believe that the model may not turn the situation upside down (Sorman 2010). The free market economists argue that it is the recession that prompted the financial crisis and not the other way around. Economists believe that recession began in 2007 when consumer spending decreased, overdue borrowing increased and lack of interest of...
5 Pages(1250 words)Essay

Comparison of Free Market Economy and Mixed Economy Systems

...? Free Market Economics vs. Mixed Economy To What Extent Do You Agree With Free Market Economics Being More Effective Than a Mixed Economy? The contemporary world is different with the invention of modern communication and speedy travel. The worldwide market changes constantly and affects every individual. Rigors of several international businesses need a top-down understanding of culture and that of monetary systems. Excluding some economies such as North Korea, there are two different monetary systems, namely, the free market economy and the mixed economy. This explication espouses each system’s demerits and merits, and concludes with a statement of the better market economy of the two. A mixed economy permits parallel operation... of...
4 Pages(1000 words)Essay

Comparative Analysis of Free Market Economy and Mixed Economy

...?According to Pryor (2006), “An economic system comprises the configuration of s and organisations that specify property relations within a given society or that channel and influence the distribution of goods and services.” Simply put, this is an organized way of distributing resources in a particular state by the government. The government imposes formal laws about how the resources are supposed to be distributed among the citizens. In some cases, informal constraints are also used to guide the way resources are distributed in a particular area. There are four different types of economic systems namely: traditional, free market, planned and mixed economy. In a traditional economic...
4 Pages(1000 words)Essay

Housing Market

... of Regulatory Economics 17, 131-155. Maddison, D.J.:, 2001, The Amenity Value of the Global Climate, Earthscan, London. Mler, K.-G.: 1977, 'A Note on the Use of Property in Estimating Marginal Willingness to Pay for Environmental Quality', Journal of Environmental Economics and Management 4, 355-369. Roback, J.: 1982, 'Wages, Rents, and the Quality of Life', Journal of Political Economy 90, 1257-1278. Steinnes, D.N. and Fisher, W.D.: 1974, 'An Econometric Model of Intraurban Location', Journal of Regional Science 14, 65-80. Straszheim, M.: 1974, 'Hedonic Estimation of Housing Market Prices: A Further Comment', Review of Economics and Statistics 56, 404-406.... need to be determined. 7. All extensive data collection has to be taken...
6 Pages(1500 words)Essay

Housing market in China the extent that it is often economically feasible for a firm to locate different phases of production in different countries. The other factor is the increasing liberalization of trade and capital markets which basically means that more and more governments are refusing to protect their economies from foreign competition or influence through import tariffs and nontariff barriers such as import quotas, export restraints, and legal prohibitions. International institutions promoting free trade in place of protectionism have been established - including the World Bank, International Monetary Fund (IMF), and General Agreement on Tariffs and Trade (GATT) which was replaced in 1995 by the...
20 Pages(5000 words)Case Study

Free Market

...Free Market. Conclusion: The of the IASB Conceptual Framework are meeting and will continue to meet till they hopefully complete the allotted task in the year 2010, as envisaged at present. The era to which they belong and to which we all belong, is unprecedented in the human history. Thousands and thousands of pages of human history daubed in blood, concerning the 'growth' of human civilization ask a crying question. How to make the human life on this Planet Earth (now the scientists have crossed the moon and do research to beat the stars!) happy, peaceful and beautiful' The answer is simple and direct. Let your eyes be full of understanding, let your heart be full of love, may you ever remain free from conflicts- this is all... Market....
2 Pages(500 words)Personal Statement
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.

Let us find you another Essay on topic Housing in a Free Market Economy for FREE!

Contact Us