Let's not forget it happens in the actual cities we live in as well! Hipster-ism gives way to gentrification and then the cool kids move because there are way too many yuppies. Same things happens with suburbs - they get too crowded and people start moving to the country to make new suburbs.
This is just human nature, it manifests itself in the clothes we wear, the cars/bikes we drive, the places we live, it certainly also applies to social websites. I'd be surprised if it doesn't - we'll see how facebook fares, or if there will be a coolkid exodus as the rest of the world gloms on.
It's basically a (sub)cultural arms race that everyone fights in.
Rent control has been a pretty effective way of preserving the identities of communities in cities. It's not perfect, but it helps. Concepts similar to rent control can and should be applied to sites trying to preserve certain characteristics.
Off-topic, but rent control has terrible problems. It lead to some grave NY neighbourhoods problems from the 60s to the 80s; back in the 20s in Paris...
A big part of political-economic maturity (for me at least) realizing that just because the supply/demand lines from your Econ 101 class don't line up, doesn't mean that something is worthless. It could be that you're not measuring everything. Culture matters, preserving social mobility matters.
Well, to be perfectly exact, in the real-world, for a limited duration, controlled rent can work fine. It just has been applied without discernment too many times.
Sure, you can screw up anything, and I certainly wasn't saying "everything should be rent-controlled".
Just kinda irks me when someone comes in with the Econ 101 argument regarding a policy that's being implemented by people with advanced degrees in city planning. These people took Econ 101, and know more about the subject than you or I. They could still be wrong, of course, but it's not for a silly simplistic reason like that.
In my experience (SF, LA) the rent control is there to prevent the gouging of yuppies, not to keep the poor people in. The idea is the city wants to keep rent just high enough to retain the rich people for the tax and spending base but low enough that the landlords to squeeze them out, which they most likely would do if given the chance.
It might be different in places other than California though, like New York.
Here in SF the geniuses of the Lembi Group bought a bunch of apartment buildings on credit (something like 1 billion dollar's worth), used questionable/borderline illegal tactics to squeeze people out of rent controlled units, and then jacked the prices way up. Then the real estate bubble popped and they went bankrupt.
Lots of landlords are stupid and will raise rent beyond the market clearing rate just to make a quick buck, resulting in empty units and shitty communities.
No, actually it's rent control that gives way to that. Landlords don't rent at a loss, and prefer keeping their apartments empty, resulting in shitty communities, then squatters, etc.
Most economists believe that a ceiling on rents reduces the quality and quantity of housing available.[41][42] This view is based on analysis of empirical evidence as well as the understanding generated by theoretical models.[42] Economists from differing sides of the political spectrum, such as Paul Krugman[43] and Thomas Sowell,[44] have criticized rent regulation as poor economics which, despite its good intentions, leads to the creation of less housing, raises prices, and increases urban blight.
It probably works both ways, depending on exactly how low or high the rents are held. I've lived in some really, really nice areas that are rent controlled (SF Pacific Heights, Santa Monica, Downtown San Diego), apparently others have lived in relatively crappy neighborhoods where rent is also controlled.
Now that I think about it further, it seems obvious that rent control would be a tool that can be used by a municipality to control rents in either direction, depending on their goals.
This is just human nature, it manifests itself in the clothes we wear, the cars/bikes we drive, the places we live, it certainly also applies to social websites. I'd be surprised if it doesn't - we'll see how facebook fares, or if there will be a coolkid exodus as the rest of the world gloms on.
It's basically a (sub)cultural arms race that everyone fights in.