Build, Baby, Build is a punchy, persuasive case for tearing up the planning rulebook and letting homes be built where people actually want to live and work. It is also a reminder that, in housing policy, the most radical idea of all is to take economics – and ownership – seriously.[1]

A comic book with serious economics

Bryan Caplan’s Build, Baby, Build: The Science and Ethics of Housing Regulation looks like a graphic novel, but reads like a crash course in housing economics and moral philosophy. In a shade under two hours, it walks the reader through how well‑intentioned regulation has throttled supply, driven up prices and quietly reshaped the distribution of wealth in modern economies.[1]

The format matters. Presenting supply and demand, zoning codes and land values in panels and speech bubbles makes the arguments unusually accessible, without dumbing them down. As the IEA reviewer notes, this is a book pitched at the layperson that still has enough rigour to jog the memory of time‑poor academics and policy professionals.[1]

How regulation broke the housing market

Caplan’s core claim is disarmingly simple: governments have made housing expensive by making new housing illegal in the places it is most valued. He highlights three familiar culprits: strict height limits in cities, large‑lot requirements that mandate under‑used land, and zoning that reserves vast swathes of urban area for detached houses only.[1]

The consequences are stark. Caplan cites evidence that Americans now spend around 20 per cent of their budgets on accommodation, and that inflation‑adjusted house prices have roughly doubled since 1980 even though building costs have been broadly flat. Economists across the spectrum – from Paul Krugman to Jason Furman and Matt Yglesias – are brought in to demonstrate that this is not a fringe libertarian complaint but an emerging consensus.[1]

Deregulation as a “panacea” policy

Where the book becomes provocative is in its claim that serious deregulation would not just trim prices at the margin, but act as a broad‑spectrum cure for many of the ills currently blamed on “capitalism”. Caplan estimates that ambitious housing deregulation could cut average US house prices by around 11 per cent, with a comparable boost to living standards.[1]

He then pushes further, arguing that freeing up housing supply would:  
•⁠  ⁠Increase social mobility by allowing more people to move to high‑productivity cities.[1]
•⁠  ⁠Reduce “deaths of despair” by creating more meaningful work in construction and associated trades for left‑behind workers.[1]
•⁠  ⁠Lower homelessness by easing the price pressure at the bottom of the market.[1]

One empirical point is particularly striking. The rising share of national income going to capital since 1948, often invoked by critics of inequality, appears to be almost entirely accounted for by the housing sector once the data are disaggregated. In other words, when people complain about capitalism delivering windfalls to asset‑owners, they are often complaining about planning‑constrained land values rather than productive investment.[1]

Answering the classic objections

Caplan is at his best when dealing head‑on with the familiar objections to building more. Concerns about congestion are met with a straightforward recommendation: price scarce road space properly rather than rationing homes. Environmental worries are countered with the observation that newer homes are typically more energy‑efficient – those less than twenty years old emit around 30 per cent less than the average.[1]

Aesthetic anxieties and “neighbourhood character” are treated as a mix of status quo bias and fear of change. Caplan argues that protecting yesterday’s skyline by freezing development often comes at the cost of the “greater beauty of tomorrow”, using the replacement of the old Waldorf Astoria with the Empire State Building as a telling example. The reviewer suggests an even cleaner line of argument: if people are free to choose whatever aesthetic they like in cars, why should buildings be different?[1]

Property rights and NIMBY psychology

Politically, the book is unapologetically rooted in *property* rights. Caplan treats private ownership as a “rigid bright line” that policy should respect, warning that once exceptions like the 1920s Euclid zoning case are normalised, the result is a slippery slope towards ever‑expanding state control.[1]

He also devotes space to why NIMBYism is so persistent. Economic illiteracy, status quo bias and “sheer paranoia” are indicted as the main drivers. One cited survey from 2018 is revealing: 62 per cent of renters supported banning development in their neighbourhood, compared with just 40 per cent of homeowners, suggesting that fear of change can trump even direct financial incentives.[1]

Where the argument falls short

The IEA review identifies three weak spots that are relevant for policymakers in Australia as much as in the United States. The first is immigration: Caplan largely sidesteps it, even though many voters instinctively reach for lower migration rather than more building when confronted with high prices. A short engagement with that political reality would have strengthened the book’s reach across audiences.[1]

Second, the defence of demolishing historic buildings in pursuit of future beauty is seen as under‑argued. For communities worried about losing genuinely significant heritage, a more nuanced framework – distinguishing between preserving the truly irreplaceable and freezing entire suburbs – would be helpful.[1]

Third, the explanation of how prices fall when supply increases leans too heavily on builders “cutting prices” rather than on competition in land markets. As the reviewer notes, what really falls when regulation is relaxed is the scarcity value of land with permission, as owners underbid each other until prices converge on alternative uses. That distinction matters in countries, like Australia, where debates about “greedy developers” routinely obscure the role of planning‑created land scarcity.[1]

Why this matters for Britain and Australia

Although Caplan writes about the United States, the themes are uncomfortably familiar in Britain and Australia. Anti‑growth planning systems, discretionary approvals and a thicket of overlapping regulations have combined to push the dream of home ownership further out of reach for younger and lower‑income households. At the same time, rising land values have quietly redistributed wealth towards incumbent owners at the expense of those still trying to get a foothold.[2][3]

Institutions like the Institute of Economic Affairs have long argued that serious deregulation is essential if the housing crisis is to be tackled at its root rather than managed at the margins. Caplan’s contribution is to package that case in a way that is both analytically robust and politically communicable – a rare combination in a field dominated by technical reports and emotive local controversies.[3][2][1]

A tool for changing the housing conversation

For elected representatives, councillors and advocates of reform, Build, Baby, Build offers more than just an argument; it offers a new way to talk about housing. By humanising the costs of restriction and spelling out the gains from growth, it helps shift the debate from “how do we stop things changing?” to “how do we make it possible for more people to live where opportunity is?”.

The IEA review concludes that none of Caplan’s arguments are genuinely new, but that their graphic presentation and relentless clarity give them fresh power. That is exactly what the housing debate needs: not another glossy strategy document, but a clear, visual reminder that when we choose to strangle supply, we also choose higher prices, lower mobility and deeper inequality – and that we can, if we wish, choose differently.