John Harris gets confused by the basics of markets

Not that this is unusual in the opinion pages of The Guardian but really. Some of these people are almost as old - and therefore have had the chance to develop the same wisdom and maturity - as we are.

The most recent data shows 12,764 households on the city’s social housing waiting list. But one figure is particularly shocking: reflecting the fact that most local authorities now lack either the means or will to build anything more than paltry amounts of new social housing, the city’s “additional social rent dwellings” in 2023-24 totalled – and read this slowly – five.

When something is below market price there is a queue for it. If people can supply then they’ll supply at the market price - more money for them, see? And if someone can buy at less than market price then they’ll have to queue. Because lots of people are interested in something at less than market price.

Which is why those two lines on the graph meet - the market price is the price at which desire expressed through demand is met by willing supply. This is not difficult, it’s the first two pages of every economics book ever but boy oh boy does it seem to confuse an alarmingly large number of people.

Of course there’s a queue for below market something - that’s what below market price means, that there will be a queue.

We do tend to think that the place will be better governed if rather more people were aware of basic reality. You know, hope springs eternal and all that?

Tim Worstall