Something else will get expensive in the meantime, e.g. it doesn't matter how much you earn, landlords will always increase rent to the limit because a living space is a basic necessity
No, landlords will increase rent as much as they can because they like money (they call it capitalism for a reason). This is true of all goods, both essential and non-essential. All businesses follow the rule of supply and demand when setting prices or quickly go out of business.
In the scenario being discussed - if a bunch of companies hired a whole bunch of lawyers, markerters, etc that might make salaries go up due to increased demand (but probably not super high amoung as tech isnt the only industry in the world). That still first requires companies to be hiring more of these types of people for that effect to happen, so we should still see some of the increased output even if there is a limiting factor. We would also notice the salaray of those professions going up, which so far hasn't happened.
It's an observed effect that rent increases until everyone is just as miserable as before. Regulatory capture of the building industry might have something to do with it, but you can't just say it doesn't happen.
» landlords will always increase rent to the limit
In your own words, a business will run out of business quickly if supply and demand do not match. So unless you are confident that there will be a buyer, you cannot raise prices infinitely.
» because a living space is a basic necessity
While most people can live without a netflix subscription (hence they cannot raise prices infinitely and still expect to find buyers) most people prefer to live in housings. A housing is a basic necessity hence as a landlord you can confidently raise prices to the barrier of an affordability limit.
» Something else will get expensive in the meantime
Lets assume electricity prices get really cheap because humanity discovers fusion reaction. Well guess what, now landlords will increase the rents again because they can.
Hope I expressed myself to your liking. I mean you just walz in here and start lecturing people about capitalism, maybe you should change your careerpath and become a teacher.
