Most people have ideal commute distances of about 30 minutes: Note clearly that my distance unit is time. Anything within 30 minutes, regardless of transport modes, is close, anything more is far. Eventually the time to get to the inner lanes is longer than 30 minutes and you cannot go wider. Of course this is reduction to absurd.
Roads can go up (or down) quite a bit though. It is expensive (much more expensive than adding more lanes) which is why we rarely do it. Even when/where we have, we would have to go more than we have to get ahead.
My point is you can get ahead of induced demand. I know a farmer who planted right across a public road - technically illegal, but the neighbors didn't use that road anyway. When you get in a city is is harder - by enough that it isn't worth it - but you can. (Cities should of course have more public transit which gets ahead much quicker).
You are correct that cities building - at affordable rates - do attract people. However if the city allows building over the long term we know from existing examples it gets out of it. Chicago and Huston don't have housing price problems because you can build there.
Now we do need to be clear: it costs money to build. New houses are always higher end. How high depends, if only a few houses can be built, they will be mansions. Once demand for mansions is filled builders move down market to lower profit houses until it is no longer feasible to build anything (humans don't fit in a doll house).
The paper is no only slightly better supported by data than my arguments above and really isn't useful.