“Zumper has found that for every $1 billion in venture capital injected into a local economy, 1-bedroom rents will increase $69 per month, and 2-bedroom rents will increase $99 per month,” the report concludes. In America’s tech hubs—namely San Jose, Boston, New York, Los Angeles, Seattle, and above all, San Francisco—venture capital is reportedly driving rents toward unprecedented extremes, it would seem. And since rents are rising, and tech money is out there, why wouldn’t that be the case?

Yet as Kim-Mai Cutler notes at TechCrunch, the study does not account for the glorious range of zoning regulations across American cities. This oversight means that developers across every city are ostensibly responding to the infusion of venture investment in the same way. In this universe, Houston developers would react to tech cash the same way San Francisco does, despite the fact that Houston is an order of magnitude larger than San Francisco in size and population, and San Francisco is a peninsula.

...

Local NIMBYism in highly productive labor markets is a national worry. It’s bad for the economy for so much capital to be invested in accommodating soaring rents for workers. Property owners win, workers lose, non-workers can’t even get into the race, and renters are treated to displacement and systemic abuses. There are solutions to this crisis: upzoning dramatically, taxing property wealth appropriately, and subsidizing housing costs for a larger share of low-income residents.