Thanks for the explanation. It is essentially the same one I was taught in an economics class at UNH in 1971.
While I don’t disagree with the theory, it works when you are discussing locally produced products that are exported outside a geographical area and where the demand for those goods outside the local area has no effect on the local economy.) I think it doesn’t apply it this situation. If the demand for products or services increase locally, regardless if the buyer is local (internal) or from out of the area (external), prices will increase locally. These increases will start, or continue the price/wage/price/wage cycle.
I also believe that housing is only one factor in the cycle. For example food, which is more expensive in the lakes region then in suburban Boston (per my wife) is a factor. This demand may be caused by fewer local outlets (demand) or price increases because “seasonal residents can afford it” but it is there. Also, more and more of the seasonal vacation residences are being transformed into year round homes that bring what locals call “flat landers” to the region more and blur the boundaries of seasonal demand.
(This will be my final post on this subject as it appears JM and I are dominating the thread. JM, thanks for the discussion.)
Sent from my iPhone using
Winnipesaukee Forum mobile app