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Doesn't this just make homes unnecessarily more expensive?


It depends what you mean by unnecessarily. Public policy has multiple goals and stakeholders. If your policy priority is high bandwidth to large portions of the educated population for the long term economic benefits - and if you feel that this dramatically increases your global economic competitiveness, thereby increasing income and living standards for all, then you probably don't consider the small marginal additional cost per unit as unnecessary.


I'm with the original commentor. The first question we should ask if not "does this provide value to the individuals in a specific group?" but what are the unintended consequences for everyone in the economy?

This is explored very well in the book "Economics in One Lesson": http://en.wikipedia.org/wiki/Economics_in_One_Lesson


Questions we ask are not going to influence policy in China which runs by a different set of rules.




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