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The Effect of Land Use Regulation on Housing and Land Prices

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Abstract

This paper investigates the effects of land use regulation restrictiveness on house and vacant land prices. In contrast to prior studies, the index of restrictiveness is treated as an endogenous variable and estimated effects are allowed to vary by market setting. Using data on more than 100 Florida cities, greater regulation restrictiveness is found to increase house price and decrease land price. Evidence is also provided showing that more restrictiveness increases the size of newly constructed homes.

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... In der Regel steuern die Gemeinden die Siedlungsentwicklung. Wie in der Einleitung aber bereits erwähnt, sind sie dabei in ein komplexes Planungssystem mit vielen unterschiedlichen Regulierungsansätzen auf regionaler, bundesstaatlicher und nationaler Ebene eingebunden. In bisherigen Studien erfolgt die Messung von Regulierungsansätzen am häufigsten auf lokaler Ebene (Gyourko et al. 2008;Ihlanfeldt 2007;Pendall et al. 2006). Ansätze, die regionale (Dawkins und Nelson 2003;Nelson et al. 2007;Schmidt et al. 2017) und bundesstaatliche (Dawkins und Nelson 2003;Siedentop 2008;Yin und Sun 2007;Zaspel 2012) Ansätze operationalisieren, sind deutlich seltener. ...
... Bestehende Ansätze unterscheiden sich zudem darin, ob der Einsatz unterschiedlicher Regulierungsansätze (Ihlanfeldt 2007;Levine 1999;Quigley und Raphael 2005) oder institutionelle Aspekte (Dawkins und Nelson 2003;Howell-Moroney 2007;Yin und Sun 2007) erfasst werden. Insbesondere die bestehenden Ansätze auf regionaler und bundesstaatlicher Ebene konzentrieren sich fast ausschließlich auf institutionelle Aspekte. ...
... 4) Dagegen erfolgt die Operationalisierung von Regulierungsansätzen auf lokaler Ebene in der Regel anhand von aggregierten Indizes (Gyourko und Molloy 2015). Dabei kann zwischen verschiedenen Verfahren unterschieden werden, die entweder die eingesetzten Regulierungsansätze summieren (Ihlanfeldt 2007;Levine 1999;Quigley und Raphael 2005) oder mehrere standardisierte Teilindizes aggregieren (Gyourko et al. 2008(Gyourko et al. , 2019Jackson 2018;Monkkonen et al. 2020). Datengrundlage sind oft schriftliche Befragungen der Planer vor Ort (Gyourko et al. 2008;Gyourko et al. 2019;Monkkonen et al. 2020;Nelson et al. 2002). ...
... Despite this, a positive value for an individual exemption to a land-use regulation continues to be interpreted as proof that compensation is due under Oregon's Measure 37. Indeed, the study believes that this mistaken interpretation may be partly responsible for public sentiment that land-use regulations according to the study tend to reduce property values. In the same vein, Ihlanfeldt (2007) [22] investigated the effects of land use regulation restrictiveness on house and vacant land prices. The results presented in this study suggested that land use regulation has important effects on the prices of housing and vacant land. ...
... Despite this, a positive value for an individual exemption to a land-use regulation continues to be interpreted as proof that compensation is due under Oregon's Measure 37. Indeed, the study believes that this mistaken interpretation may be partly responsible for public sentiment that land-use regulations according to the study tend to reduce property values. In the same vein, Ihlanfeldt (2007) [22] investigated the effects of land use regulation restrictiveness on house and vacant land prices. The results presented in this study suggested that land use regulation has important effects on the prices of housing and vacant land. ...
... Although the emergence and differentiation of planning and evaluation-theoretical currents have increasingly drawn attention to the unintended effects of planning regulation (Alexander & Faludi, 1989;Laurian et al., 2010), research tends to focus on Anglo-American case studies and the municipal level (Ihlanfeldt, 2007;Jackson, 2016;Mayer & Somerville, 2000). Nevertheless, there are also studies in the European context for England (Hilber & Vermeulen, 2016) and the Netherlands (Altes, 2006;Vermeulen & van Ommeren, 2009), which take up the neoclassical criticism of planning. ...
... Moreover, a price effect only occurs if the regulation reduces the supply of housing below demand (Landis, 2006). In addition, Ihlanfeldt (2007) comes to the conclusion that local land use regulations lead to rising house prices, but that land prices fall, as regulation increases developers' costs more than housing prices. By contrast, Mathur (2014) shows that urban growth boundaries lead to rising land prices but hardly to rising housing costs because there is enough land for the anticipated 20-year housing supply. ...
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Regional planning plays a central role in Germany's multi-level system for managing regional and local land use, giving concrete shape to state planning specifications and providing municipalities with binding guidelines for urban land use planning. While planning proponents affirm the positive effects of regional planning such as reduced land consumption and less urban sprawl, representatives of neoclassical urban economic theory see regulation as the reason for lower economic growth. With the help of fixed effects panel models, we examine the impact of regional planning regulations on the housing market, migration and prices in Germany's growing labor market regions. We conclude that regional planning regulations reduce construction activity. However, this effect is relatively small and does not raise building land prices and rents. Nevertheless, results indicate that the lower level of construction activity—due to strict regional planning regulations—contributes to weaker overall population growth. Based on our results, we cannot confirm important predictions of neoclassical urban theory regarding the effects of regional planning regulations on labor migration patterns and downstream processes for Germany.
... Irrespective of differences in political attitudes, it has long been established that homeowners demonstrate higher levels of political participation with their local community than their non-homeowner counterparts (Dietz and Haurin 2003;Gilderbloom and Markham 1995;Kingston and Fries 1994;Rusch 2012). Homeowners represent a relatively large and politically powerful constituency that is consistent in its opposition to new large-scale development or increased density (Glaeser and Ward 2009;Hankinson 2018;Ihlanfeldt 2007;Rothwell and Massey 2009). Thus, housing commodification's preference for near-universal homeownership has created a large class of stakeholders in the housing policy subsystem who are more or less focused on maintaining the housing and community development status quo. ...
... In the literature, the primary focus on NIMBYism has been the way it limits useful housing supply and ultimately drives up prices (Dewilde and De Decker 2016;Hankinson 2018;Ihlanfeldt 2007). According to Clingermayer (2004), "land-use controls such as minimum lot sizes, restrictions on multifamily dwellings and mobile homes, and architectural design specifications often have substantial impacts upon the availability of housing at prices that low-income families can afford" (p. ...
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Affordable housing policy in the developed world has been undergoing a systematic commodification for several decades, including a push for homeownership as the normalized tenure and a commodity unto itself. Scholars suggest this push for homeownership is part and parcel of a neoliberal asset-based welfare to supplement, or even outright replace, traditionally defined benefit pension schemes. These policies individualize risk and re-fashion individual citizens as long-term financial planners, navigating the uncertainty inherent in international financial markets and general financial management. Less deeply explored, however, are the perverse incentives this system creates for homeowners to protect their home “investment” by leveraging planning policies, zoning, and land-use restrictions to preserve the community status quo and lock in the value of their home. In a policy environment in which long-term financial risk is individualized and public social welfare and pension systems are relegated to the smallest number of individuals possible, this type of NIMBYism (Not in My Backyard) is rather rational behavior, even as it simultaneously staunches the supply of new housing and drives up prices for non-homeowners. As such, this analysis synthesizes the existing research to make a formal theoretical connection between the neoliberal push for commodified housing, asset-based welfare, and the intractable political problem of NIMBYism.
... The land is closely related to housing prices as a prerequisite for the real estate market. Ihlanfeldt (2007)supports that relaxing land restrictions can ease housing pressure and lower housing prices. Yi & Wong (2022) studied the long-term relationship between land supply and housing prices in China, which further confirmed that increasing land supply would help reduce housing prices to a certain extent. ...
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With the rapid growth of China’s economy, the urbanization process is accelerating, and urban development is getting faster and faster. Housing prices have become a concern for more and more residents. This paper empirically studies the determinants of housing prices, including population, region, land factors, and government fiscal measures. Multiple linear regression models interpret the economic implications of empirical results by collecting unique data sets from multiple sources. The results show that government fiscal revenue, real estate investment, and land value positively correlate to housing prices. This article makes insightful comments on the above analysis, which is significant to the government, real estate developers, and residents. To a large extent, the government can take measures to adjust the housing price and solve the housing problem. Achieve the purpose of sustainable development.
... Note that for wealthier households, in particular those with income above some indicated level of ÿ, the restrictive land use regulations represented in Fig. 1 are not binding. Those higher-income households would have 2 The exclusionary nature of many such regulations has long been a subject of controversy, as they may have a de facto role in filtering out households based on ethnicity, income or other socio-economic factors (King, 1978;Pendall, 2000;Ihlanfeldt, 2007;Manville et al., 2020). chosen to consume the minimum required housing level or more even in the absence of such restrictions. ...
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This paper examines how land use regulations applied in the formal sector can influence housing outcomes in both the formal and informal sectors, using metropolitan Buenos Aires as our case study. In particular, it addresses the question of whether land use regulations may contribute to the presence of informal settlements by restricting opportunities in the formal sector. In this context, the contributions of this paper are several-fold. Our theoretical model provides a direct test of a crowding-out hypothesis by which binding land use regulations limit the absorptive capacity of the formal sector, thereby creating spillovers into the informal sector. The base model is also extended to accommodate two alternative adjustment mechanisms whereby households relocate either to municipal jurisdictions with more suitable land use regulations (the Tiebout mechanism) or to locations further from the city center where land costs are lower (the Alonso mechanism). We also employ two distinct yet complementary datasets. First, we conducted a survey of representative households living in informal settlements and in nearby formal areas. The other dataset is derived from an innovative merging technique applied to the Census and the National Expenditure Survey (ENGH) of Argentina. Notwithstanding their rather distinctive approaches, both methods yielded similar results. At an empirical level, our findings confirm the existence of a rent premium for accessing the formal housing sector, consistent with our model predictions. Our results also show a strong interconnection between infrastructure provision and housing outcomes, which underscores the important role of infrastructure both in delineating formal sector housing developments and in delivering essential housing services, broadly defined. While we find clear evidence of the Alonso mechanism, our empirical findings suggest that the Tiebout adjustment mechanism may not be fully realized in metropolitan Buenos Aires due to lack of variability in land use regulations across local jurisdictions-there is little incentive for a household in one jurisdiction to relocate to another jurisdiction if land use regulations there are no different.
... Land use regulations impact many aspects of urban life, including travel activities, housing and land prices, urban built environments, and urban growth (Ihlanfeldt, 2007;Huang and Tang, 2012;Feiock et al., 2008;Cervero, 1991;White, 1988). Land use regulations play a central role in shaping the patterns of land use and facilitating changes in the built environments, which consequently influences individual or family's location choices and daily travel needs (Bhat and Guo, 2007). ...
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In the U.S., various anti-sprawl land use regulations have been implemented for over two decades. Previous studies primarily investigate the impacts of local land use regulations or neighborhood-level built environment attributes on travel behaviors within a narrow time frame. Through a different lens, this paper examines how various local land use regulations and transit investment, both measured at the aggregated metropolitan level, have affected people's long-term travel behaviors over a 15-year period, and how these impacts differ between younger and older age groups. This study combines a set of land use regulation indices measured at the metropolitan level in 2003 with 15 years of travel data (2005-2019) from a pooled representative sample of over 8 million workers in the 50 largest U.S. metropolitan areas. Results show several local anti-sprawl land use regulations (e.g., growth containment, adequate public facilities, and moratoria), when combined at the metropolitan level, effectively reduced driving notwithstanding their marginal effects. Government investment in public transit also significantly increased commuters' likelihood of using public transit and, carpooling, as well as increased carpool group size. Moreover, the commuting mode choices of younger workers are more responsive to transit improvements and land use regulations. Urban planners should commit to regional cooperative planning to promote effective land use regulations at the metropolitan level. Regional collaborative entities, such as metropolitan planning organizations should play a larger role in coordinating local land use planning and regulations. To reduce automobile dependency, planners should commit to improving public transit through enhanced financial assistance, harnessing land use regulations in a more targeted way, and accommodating the needs of different age cohorts.
... According to Michael, J. and Palmquist, R. [28], some researchers, in order to explain the differences in the impact of land use regulation on the value of real estate, including land, in different settlements, apply restriction severity indices, counting their number and using them as an index in the hedonic regression model. Research by Ihlanfeldt, K.R. [29] has proven that land use regulation has a significant impact not only on the prices of undeveloped land but also on residential properties. The results suggest that estimates of these effects may be biased if the measure of regulatory constraint is seen as exogenous to housing prices or if the estimated effects cannot vary with market conditions. ...
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This article discusses the need to transform real estate valuation methods. It is associated with the problems of obtaining unreliable results affecting the subsequent adoption of management decisions. As an important element of land plots assessment, the authors define the Negative Infrastructural Externalities arising from the presence of infrastructure and other regime-forming facilities. These externalities represent the loss of title holders due to the encumbrances arising from the use of land plots. The world community (and the authors as part of it) sees one of the transformation methods in the automation of the evaluation process. Therefore, the purpose of this study is to develop a mechanism of automating the Negative Infrastructural Externalities assessment process in the conditions of a non-existent and weak market activity of land relations. Modern trends dictate the saving of hardware, labor and money resources; in this connection, the methods of Negative Infrastructural Externalities assessment are implemented on the basis of the “thin client” technology. The research is based on the following methods: the analytical method is used to perform a critical analysis of the problem area and to substantiate the research topic’s relevance; methods of object-oriented programming and methods of modular programming (Cowan’s axiom of modularity) are used as tools for developing the web application logic, as well as the interaction of its individual elements; the attribute-driven design approach is used in the creation of software architectures. The result of the study is the developed and substantiated architecture of a web application for assessing negative infrastructural external factors in determining the land value, the implemented modular structure of the specified web application and the developed conceptual model of the database. The practical implementation of the listed proposals is made by means of the Python programming language. The advantage of the created automated system is the possibility of multi-disciplinary use of the expert assessment approach when changing the settings.
... 3 Glaeser and Ward (2009) overcome the endogeneity of land use regulation by using a panel data of restrictions on building construction, but adopting their approach is difficult due to data constraint. Ihlanfeldt (2007) employs the instrumental variable approach to identify the causal effect of land use regulation. An appropriate instrument for land use regulation enables researchers to avoid the endogeneity of land use regulation inherent in cross-sectional data. ...
Article
This paper examines the causal effect of land use policy on employment growth in Chinese cities. We find that a stricter Floor Area Ratio Regulation (FARR) leads to a reduction in employment growth in Chinese cities-a one percentage point reduction in FARR leads to a concurrent reduction of employment growth by 1.0–1.5 percentage points. More populated cities and labour-intensive manufacturing industries are found to be more severely affected by stricter FARR. Moreover, the effect of a stricter FARR is found to be less pronounced on state-owned firms compared to foreign-owned and privately-owned firms. Our main conclusions are robust to a variety of sensitivity tests, different instruments and alternative estimators. They suggest that imposing a stricter legal FARR incurs considerable employment costs for Chinese cities.
... The study contributes empirical results to discussion on regulations imposed by public authorities and their quality. The literature (Nozeman and van der Vlist, 2014;Needham and Louw, 2006;Ratcliffe et al., 2009;Ihlanfeldt, 2007;Kaufman et al., 2015;Anderson, 2019;Nowak and Fory s, 2019) argues for their high impact on real estate markets. ...
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Purpose The purpose of the article is to improve the understanding of the role of institutional factors in real estate development. The authors take into account zoning (existence and type), type of right of disposal and type of buyer and seller of property in a multivariate econometric estimation. Dependent variable of the analysis is the time between acquisition of empty land and the application for a building permit, a period when many important development decisions have to be made. This indicator is closely related to debated phenomena like land hording and speculation. Design/methodology/approach The authors estimate a Cox proportional hazard model with the time between acquisition and application for a building permit as dependent variable and institutional indicators and a number of control variables as explanatory variables. Study area is the GZM Metropolis in the South of Poland. This region shows enough variability in institutional arrangements to allow for this type of analysis. Findings The analysis shows that institutional factors significantly influence the real estate development process. In areas that have not issued a zoning plan, the period until the building permit application is significantly longer. When the state is involved in a transaction (as purchaser or seller), it also takes longer until the building permit application is submitted. Although the instrument is usually intended to speed up development, perpetual usufruct implies a longer period until building permit application. Because of the results the authors get for control variables and for robustness checks, the authors are confident of the results of the analysis. Originality/value To the authors’ knowledge, this is the first study that deals with the question how institutional factors influence the timing of real estate development. By using data for a region in Poland, the authors also add to knowledge about real estate development in CEE countries.
... Restricting the use of land effectively reduces the price of land by limiting the potential for developer profits. Ihlanfeldt (2007) argues that regulation restrictiveness decreases land price. City authorities should also effectively implement land value capture to raise revenue that can be reinvested into city services. ...
Article
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Following goal 11 of the Sustainable Development Goals, cities, especially those in the Global South, are striving to become sustainable and inclusive. However, those cities' intricate land governance system and associated practices present problems that may undermine the achievement of inclusiveness. Given this context, this study assesses the implications of the land governance system of Ghana, a Sub-Sahara African country, for the development of inclusive cities. The generality of the urbanisation experiences and similarities in the land governance practices in SSA imply that the results can provide useful lessons for the whole region. With literature from databases like ProQuest, JSTOR and Scopus, the paper first conceptualised inclusive cities as those promoting physical access of urbanites to basic services, protecting rights and opportunities, and creating opportunities for economic development. Following this was a review of the nature of land governance in Ghana. The results show that land governance practices in Ghana and their associated problems undermine Ghanaian cities’ inclusiveness in economic, social and environmental terms. The unregulated land market in Ghana, for example, has priced out many urbanites from the land and housing markets. Women residing in Ghana’s cities encounter greater legal pluralism and economic issues in gaining access to land. Additionally, poor land management practices have led to the conversion of green spaces in cities to other land uses. The study concludes that Ghana’s land governance system may stifle its determination to develop inclusive cities. The study recommends the introduction of land-use regulations by statutory authorities in collaboration with traditional authorities to restrict the use of land (increase density, build multi-family properties, inclusionary zoning). The Government of Ghana in consultation with customary authorities, civil society groups and development partners should revise Ghana’s land policy to account for inclusiveness in access and use of land in cities.
... Regarding the measurement of the land supply structure index, two indexes are commonly adopted: area and price [51,57,[78][79][80][81][82]. On this basis, the deviation degree of the price of industrial land is measured and expressed by "(the transaction price-the lowest price standard) / the lowest price standard". ...
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Population urbanization is crucial to establishing a harmonious society. However, the phenomenon of population semi-urbanization is becoming an issue of ever-increasing concern in China. More and more immigrants from rural areas work and live in the city, but their roots remain in the rural area. This paper aims to analyze the influence mechanism of government competition on population semi-urbanization through land supply structure. The study’s theoretical analysis and empirical analysis results are based on the panel data of 105 key prefecture-level cities in China from 2007 to 2017. The results demonstrate that: (1) land finance and land-motivated investment engendered by government competition lead to an imbalance in the land price structure, further increasing the rate of population semi-urbanization; (2) land finance does not lead to population semi-urbanization through the land area structure; and (3) land-motivated investment aggravates the imbalance in the land area structure, further leading to population semi-urbanization. It is found that government competition in terms of achieving performance indicators affects population semi-urbanization by adjusting the land supply structure. Efforts should be made to achieve the coordinated development of urbanization, given that the increasing rate of population semi-urbanization will almost certainly aggravate social instability.
... Such policies have been proved to significantly boost land value [28,29]. In many countries, spatial planning policy that allocates land into particular built areas has sped up the growth of the areas, correlating with an increase in land value [52,53]. Therefore, the growth of urban and coastal areas often increases land value. ...
Article
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Coastal areas have been growing massively worldwide. The fast growth also affects the land value in either a positive or a negative way. Many scholars have studied land value and the factors that affect it in areas prone to sudden-onset disasters. In contrast, studies on urbanized coastal areas that suffer from slow-onset disasters are still lacking. Using a case study from Semarang City in Indonesia, this research aims at ameliorating this limitation. To comprehensively understand the aim, two research questions are addressed: (1) What is the distribution of land value in urbanized coastal areas? (2) How do the different distribution factors determine the land value? Based on in-depth interviews with key persons, map analyses, and desk studies, this research discovers that land value is distributed randomly among coastal areas. The dynamics of land value are determined by road access, distance, and accessibility to the city center and CBD, public facilities, transportation facilities, population composition, physical environment, and disasters. Surprisingly, the coastal areas in Semarang that experience combined disasters showed that disasters could not decrease the land value; the value in some areas is constant or even increasing. This shows the different impacts of disasters on land value for slow-onset disasters and sudden-onset disasters.
... With the development of geographic information system (GIS) technology, scholars have introduced the geographically weighted regression (GWR) model into land price-related studies and proven the usefulness of the model. For example, scholars such as Ihlanfeldt [43], KangRich [44], and Harris [45], by establishing relationships between land price and related factors through GWR, have demonstrated that this type of model outperforms OLS regression models and other spatial econometric models such as spatial autoregressive (SAR) models, structural equation models (SEMs), and spatial autoregressive combined (SAC) models. Leveraging the practicality and accuracy of the GWR model, scholars have explored the influences of traffic factors [46], location factors [17], and public service factors [47] on land price and have been able to calculate the contributions of various factors to land price [48] as well as reveal spatial heterogeneity [10,16]. ...
Article
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Land prices are the key problem of urban land management, with prices of residential land being the most sensitive and the strongest social reflection among the different land types. Exploring spatial and temporal variation of residential land prices and the effect of land market factors on residential land prices can help the government formulate targeted regulations and policies. This study analyzes the spatial and temporal evolution of residential land prices and the factors influencing the land market in the Beijing-Tianjin-Hebei region based on land transaction data from 2014–2017 using exploratory spatial data analysis (ESDA) and a geographically weighted regression (GWR) model. The results show the following: ① Residential land prices in Beijing and Tianjin are significantly higher than those in other regions, while Zhangjiakou, Chengde, and western mountainous areas have the lowest residential land prices. Over time, a development trend of residential land price polycentricity gradually emerged, and the locational correlation has gradually increased. ② Under the influence of the land finance model of local governments in China, three factors, namely, the land stock utilization rate, revenue from residential land transfers, and the growth of residential land transaction areas, have significantly contributed to the increase in residential land prices. ③ Under the land market supply and demand mechanism and government management, four indicators, namely, the land supply rate, the per capita residential land supply area, the degree of marketization of the residential land supply, and the frequency of residential land transactions, have suppressed the rise in residential land prices. ④ The overall effect of land market factors on residential land prices in the central and northern regions of Beijing, Tianjin and Hebei is stronger than that in the southern regions, which may be related to the more active land market and stricter macromanagement policies in Beijing, Tianjin and surrounding areas.
... Current homeowners often have strong incentives to lobby in favour of building height restrictions, as well as other types of regulatory mechanisms that reduce the supply of floor space (Fischel, 2001;Schuetz, 2009), as such regulations may increase the housing prices of the existing dwelling stock (e.g. Ihlanfeldt, 2007). ...
Chapter
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This chapter discusses policies to control urban sprawl and direct urban development to more sustainable pathways. It describes a number of land-use and transport policy instruments that can be used to achieve these objectives and analyses their potential benefits, but also the challenges arising in their implementation. The land-use policy instruments analysed include urban containment policies (e.g. greenbelts, urban growth boundaries), minimum density restrictions, property taxation, development rights and incentives for private provision of public infrastructure. Road pricing, parking policies, motor fuel taxes and investments in sustainable transport infrastructure are the main transport-related policy instruments considered in this chapter. The chapter also highlights the importance of taking into account interactions between different instruments when it comes to the development of urban policy. Finally, it emphasises the need for an integrated approach to make urban development patterns more sustainable.
... These regulations have been shown to increase housing prices in certain contexts and are, therefore, likely to remain intact over time (see e.g. Ihlanfeldt, 2007). Another reason for which building height regulations, zoning and urban growth boundaries are persistent is that adjusting them may be impossible in an already formed urban landscape and network. ...
Chapter
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This chapter provides an extensive review of the main drivers of urban sprawl, as well as of its impacts on the environment, economy and society. The chapter discusses economic, geographic, technological and policy drivers of urban sprawl, including household preferences, developers’ expectations, and stringent land-use policies. It also investigates a set of potential environmental effects of urban sprawl comprising: i) increases in emissions from more extensive car use; ii) changes in energy needs and emissions associated with residential heating; iii) losses of periurban arable land and their further effect on food prices; iv) losses of biodiversity and environmental amenities; v) degradation of water resources; and vi) changes in microclimate. The potential effects of urban sprawl on land and housing prices, public finance, and on human health, are also reviewed.
... Inclusionary policies are widely practiced in the UK, France, Canada or the US. However, the empirical evidence shows that they might contribute to an increase of house prices and decrease affordability (Ihlanfeldt, 2007). Hence, their effects on wellbeing might be mixed. ...
... Today, a buildings plot in the Warsaw or Kraków areas might fetch a price in excess of 100 euros per square metre. The development of housing in rural areas adjacent to large agglomerations proved to be the strongest trigger of increases in land prices (Ihlanfeldt 2007;Mayer and Somerville 2000) (Fig. 6.9). ...
Chapter
The socioeconomic change taking place in the CEECs post-1989 ensured the unfolding there of step-by-step if diametric change in the impact key factors have been exerting on the development of the farming sector. The social, economic and political conditioning was all transformed. In rural communities, there was a major rise in the level of interest in raising educational qualifications and otherwise upskilling; as well as in the need to find employment away from agriculture in the traditional sense. The consequence was a steady outflow of young people (above all women) from agricultural areas. In parallel with the decline in the agricultural population, there was progressing automation, specialisation and concentration of farm output. Changes in economic conditioning mainly entailed a change in the price relationship between the means of agricultural production and agricultural produce and products – to the detriment of the sector’s profitability in comparison with industry or services. As a result, any staying on in farming was mainly made possible by direct payments, subsidies and grants of external origin, as well as a steady increase in levels of efficiency in terms of mass per unit area of farm, as well as outlays of capital and labour. In turn, the political changes gave rise to a reorientation of directions of foreign trade in farm produce and products, as well as the structure characterising the demand for these. The CEECs’ accession to the EU had the effect of further reducing the diversity of farming operations, with similarity of trends reflecting the impact of the CAP. In contrast, high levels of financial support and new export opportunities where food products were concerned brought about an intensification and specialisation of farm production.
... Today, a buildings plot in the Warsaw or Kraków areas might fetch a price in excess of 100 euros per square metre. The development of housing in rural areas adjacent to large agglomerations proved to be the strongest trigger of increases in land prices (Ihlanfeldt 2007;Mayer and Somerville 2000) (Fig. 6.9). ...
Chapter
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Agriculture represents an important element of land-use structure in most European countries. Where those in the region under study are concerned, at the beginning of the period of transformation the largest shares of land taken by farming were those in Hungary (around 70%), followed by Romania (62%), Poland (60%) and the then Czechoslovakia (53%). In the 25 years that followed, the values of the relevant indicator declined most in Hungary and Poland. This leaves a current situation in which it is possible to note among the CEECs two groups of countries that differ greatly in the role in overall land use played by agricultural land. The first group comprises Romania, Hungary, Czechia, Lithuania, Poland, Slovakia and Bulgaria, in which farmland predominates in the structure overall, with figures in the 40 to almost-60% range. The remaining four countries (Estonia, Latvia, Slovenia and Croatia) have relatively large areas of forest or unmanaged land. Indeed, more than 60% of Slovenia is under forest, while in Croatia there are extensive areas of mountain and coast in which more than half of the land actually suitable for cultivation is not being made regular use of (The agriculture… 2015). This reflects a variety of factors, including migratory outflow, the commercial non-viability of production on small farm plots, and also war in the mid-1990s contributing to a degradation of land-use structure. Overall, the low shares of land used in farming reflect unfavourable edaphic and climatic conditions in the case of the Baltic States, as well as relief where the Balkan countries are concerned (Fig. 5.1).
... The previous related research included land as a production factor in the economic growth model and explored the impact of land on economic growth [38][39][40][41]. In recent years, the research on the relationship between land and economic growth under the land private ownership system has mainly discussed the impact of land use control and land landscape on housing prices [42][43][44][45], and the impact of urban land use on the agglomeration of factors [46,47]. However, China has implementedpublic ownership of land, and urban land is supplied by the government. ...
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Urbanization and land use transformation are typical characteristics of China in recent decades. Studying the effects of urban land use transitions (ULUT) on the economic spatial spillovers of central cities (ESSCC) can provide a reference for China to optimize cities’ land space layout and promote their coordinated development. Based on the direct and indirect effects of ULUT in central cities on the production factors and economic growth in other cities, this paper reveals the mechanisms underlying the influence of ULUT on ESSCC. Then, we usethe expanded geographical distance-weighted spatial Durbin model with the panel data of 152 Chinese urban agglomeration cities from 2003 to 2016 to empirically test it. The results show that, since 2003, the rate of urban land expansions, the level of urban land intensive use (ULIU), the degree of land marketization, and the urban land prices in China have increased substantially; and the proportionate supplies of industrial land, commercial land, and residential land have decreased. Moreover, ULUT between cities have significant spatial autocorrelations. The current ULUT have positive but small effects on ESSCC. Among them, ULIU has the greatest promotion effects on ESSCC. The impacts of ULUT on ESSCC vary greatly among urban agglomerations. The ULUT in central cities indirectly enhance the ESSCC, which mainly depend on the positive effects of ULUT on enterprise investment, infrastructure investment, labor and technological efficiency and the spatial spread effects of these production factors. This is the main intermediate mechanism by which the ULUT in central cities enhance the ESSCC. Continuing to strengthen ULIU, promote the improvement of land marketization, and establish and improve the coordination mechanism for the economic development of urban agglomerations will help to strengthen the ESSCC in urban agglomerations. The results provide evidence for how the Chinese government can enhance the ESSCC and promote the coordinated development of cities through ULUT under new urbanization.
... Examples might be the areas around Warsaw and Kraków, where values may even exceed 100 euros per m 2 . The development of housing in rural areas adjacent to large agglomerations proved to be the key factor stimulating further increase in land prices (Mayer and Somerville 2000;Ihlanfeldt 2007). ...
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Over the last three decades, agriculture in Central and Eastern Europe has undergone very profound change. This first and foremost reflected the collapse of the communist system, as well as accession to the European Union in the case of most of the CEECs. The work detailed here has thus had as its cognitive goal the identification of trends regarding selected components of agriculture’s spatial structure which have included agrarian structure, agricultural land use, and the structure of agricultural production. Attention has also been paid to what conditioned the transformation, as well as the spatial differences that characterised it. With a view to these objectives being achieved, 11 current EU Member States in the region were analysed, above all by reference to source materials from EUROSTAT and the FAO.
... 5. See, for example, Ihlanfeldt (2007) for a discussion of how land use regulations affect land and house prices. The ability of landowners to capture the surplus will depend on local supply and demand elasticities but also on the relative size of the jurisdiction in the regional housing market. ...
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Problem, research strategy, and findings: The width of street rights-of-way is normally determined by traffic engineering and urban design conventions, without considering the immense value of the underlying land. In this article, I develop an economic framework that can inform decisions on street width, and I use tax parcel data to quantify the widths, land areas, and land value of streets in 20 of the largest counties in the United States. Residential street rights-of-way in the urbanized portion of these counties average 55 ft wide, far greater than the functional minimum of 16 ft required for access. The land value of residential streets totals $959 billion in the urbanized portion of the 20-county sample. In most counties, subdivision regulations are binding. That is, few developers choose to build streets that are wider than code requirements, implying that softening requirements would mean more land devoted to housing and less to streets. Although I highlight the potential for narrower street rights-of-way, I did not consider detailed design issues. Nor did I analyze how any windfall from reduced land requirements would be divided among landowners, developers, and house purchasers. Takeaway for practice: Particularly in places with high land values and housing costs, reallocating street rights-of-way to housing would increase economic efficiency. In the most expensive county in the data set—Santa Clara (CA)—narrowing the right-of-way to 16 ft would save more than $100,000 per housing unit through reduced land consumption. Where streets have little or no function for through traffic, the costs and benefits accrue almost exclusively to neighborhood residents. Thus, planners could reduce or even eliminate street width requirements in subdivision ordinances, leaving developers to make the trade-off between land for streets and land for housing.
... Moreover, the rapid increase in housing prices should have deeply affected household outcomes as it makes homeownership more difficult. The determinants of housing price have been well discussed within the literature under various aspects, including household income (Davis and Ortalo-Magn e, 2011), bargaining and mortgage financing (Bian et al., 2018), monetary policy (McDonald and Stokes, 2013), land use regulation (Ihlanfeldt, 2007), economic openness (Wang et al., 2011) and population migration and urbanization (Wang et al., 2017). A recent work identifies three components that drive the housing market: rational bubbles, discounted expected future rent growth rates and discounted expected future returns . ...
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Using data from the China Health and Nutrition Survey, this work examines the relationship between housing price and the probability of marriage among the young. By exploiting land reform as an exogenous change in housing price and employing a differences-in-differences framework, this study investigates the effects of housing price on the marriage probability of young people. This work confirms that land reform decreased young people's likelihood of marriage. This finding is robust to a series of model specifications. The effects of land reform increased over time because of rising housing unaffordability from progressively inflating housing prices. Moreover, land reform had larger effects on renters and young adults aged below 30 than homeowners and young adults aged above 30. Overall, this study highlights the negative consequences of an overheated housing market on marriage in developing countries. Housing prices have increased dramatically in urban China after 2002 upon the implementation of the assignment system of the use right of all kinds of profit-oriented lands by means of public bidding, auction and quotation. High housing prices indicate serious housing unaffordability, especially for young people who typically have low income and wealth. Homeownership that comes with various benefits can theoretically increase the likelihood of marriage, particularly in China where a house is often regarded as a prerequisite for marriage.
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Die vorliegende Untersuchung analysiert die Wohnimmobilienpreise und deren Einflussfaktoren in Deutschland statistisch auf der Ebene der Selbstnutzer und Investoren. Dabei wird ein vierstufiger Ansatz entworfen, der zunächst anhand von prozessbezogenen Differenzierungen die Heterogenität der Eigentümer und derer Investitionsstrategien am deutschen Wohnimmobilienmarkt herausstellt. In der Analyse zeigt sich, dass die Selbstnutzer und Investoren große Unterschiede in Bezug auf ihre Charakteristika, den Investitionsprozess, ihre Investitionsstrategien und die Professionalität aufweisen. In einem zweiten Schritt werden mögliche Einflussfaktoren auf die Wohnimmobilienpreise von Selbstnutzern und Investoren hinsichtlich ihrer Wirkrichtung im Investitionsprozess analysiert und durch die Auswertung bestehender internationaler statistischer Untersuchungen plausibilisiert. Nachfolgend werden die Ergebnisse anhand einer deskriptiven Analyse auf den deutschen Wohnimmobilienmarkt übertragen und die Zusammenhänge anhand einer Korrelationsanalyse untersucht. Die meisten Einflussfaktoren zeigen für den Zeitraum von dem Jahr 2003 bis 2019 eine starke Korrelation mit den Preisen von Wohnimmobilien für Selbstnutzer und Investoren. Die Vorzeichen entsprechen den Erwartungen aus den vorangegangenen Analysen. Für den Zeitraum von dem Jahr 2003 bis 2007 zeigen die meisten Einflussfaktoren allerdings eine stärkere Korrelation mit den Wohnimmobilienpreisen der Selbstnutzer als mit denen der Investoren. Um die Beziehung zwischen den Preisen von Wohnimmobilien für Selbstnutzer und Investoren und ihren Einflussfaktoren in einer langfristigen Betrachtung zu untersuchen, werden abschließend für die Selbstnutzer und Investoren jeweils ein Vector-Error-Correction Modell mit unterschiedlichen Wohnimmobilienpreisindizes aber den gleichen Einflussfaktoren geschätzt. Die betrachteten Einflussfaktoren sind die Haushaltseinkommen, die Neuvertragsmieten, die Baukosten und die Baugenehmigungen für Deutschland. Die Ergebnisse bestätigen grundsätzlich die vermuteten Wirkrichtungen, wobei das Modell der Selbstnutzer im Gegensatz zum Modell der Investoren einen signifikanten Anpassungsprozess und den signifikanten, positiven Einfluss des Einkommens aufweist. Insgesamt scheinen die Neuvertragsmieten und Baukosten den größten Einfluss auf die langfristige Entwicklung von Wohnimmobilienpreisen der Selbstnutzer und Investoren auszuüben. Das Ergebnis kann folglich die These unterstützen, dass Wohnimmobilienpreise von Investoren und Selbstnutzern nicht ausschließlich von den gleichen Einflussfaktoren bestimmt werden.
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This paper analyzes the economic impact that selected “look and feel” or aesthetic building restrictions have on housing prices and housing availability in Georgia counties. We model the median value of homes using ordinary least squares, and as a robustness check, we also use a partial least squares structural equations model. We also estimate a supply of housing, as measured by single family housing permits, using a negative binomial regression. We find that aesthetic building restrictions do not have a statistically significant impact on the value of single-family homes or their supply.
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The spatial imbalance between population growth, land use and housing supply is the central issue for regional coordination of urban agglomeration in China. Based on the panel data of 172 cities in 11 urban agglomerations from 2014 to 2017, this study uses the information entropy method and the spatial coupling coordination degree model to evaluate the quantitative interaction and spatial correlations between population growth, land use and housing supply. There are three key findings: (1) the main variation value of indicators has evolved from the quantity of housing supply to the quality of population growth, improving the quality of population growth has been the key factor to break the insufficient balance of indicators; (2) the coupling degree is high but the coordination degree is obviously low, the aggregation level of coupling coordination degree is generally middle, and there is obviously spatial polarization—improving the degree of coordination is the key point to break the inadequate balance of cities; (3) the coupling coordination degree is irregularly distributed in 11 urban agglomerations, the spatial correlation of coupling coordination degree is generally weak, improving the spatial coordination degree of urban agglomeration will contribute to improving the balanced sufficiency level, and the spatial coupling coordination degree is also expected to increase. This study presents a new perspective for exploring spatial coordination between population growth, land use and housing supply, which proposes a new approach to investigate quantitative interaction and spatial correlation of urban agglomeration in China.
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Problem, research strategy, and findings Although there is strong evidence that living in high-opportunity neighborhoods can improve the long-run educational and economic outcomes of children, translating this into practical advice for planners is difficult. There is little consensus about how to operationalize neighborhood opportunity, and planning discussions rarely consider how much that opportunity costs, even though planners around the country must grapple with the typically higher cost of providing housing in opportunity areas. We offer concrete guidance to planners about how to best overcome these barriers. We argue for a streamlined measure called the school–violence–poverty (SVP) index based on three contemporary metrics that research shows enhance economic mobility for children: school quality, violent crime, and poverty. Combining the SVP index with data on rental prices in New York City (NY) and Greater Boston (MA), we identified a collection of high-opportunity bargain neighborhoods with lower rents than expected given their opportunity metrics and housing characteristics. We found that high-opportunity bargain areas tended to be more affordable because they lacked amenities such as restaurants and proximity to the city center that are associated with higher rents but are unlikely to be very related to children’s economic mobility. Takeaway for practice Here we provide a streamlined, easy-to-use index for planners to identify high-opportunity bargain areas in their communities. It has direct implications for planners attempting to stretch limited budgets by helping planners decide where to get the most opportunity for their taxpayer dollars when building affordable housing and how to empower low-income families to weigh tradeoffs about where to live and achieve better neighborhood matches. The simplicity of the index can empower families to access areas that are more affordable and offer robust public services for their children.
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Using a numerical simulation model to provide a sterile laboratory for studying the long-run effects of both land use and transportation policies, this paper offers two main findings. First, we argue that land use regulations have relatively small effects on the cost of labor in large cities due to location substitution by housing producers and households. Second, we show the compensating differential paid to workers in growing cities is invariant with respect to land use regulation. In the long run, the vast majority of the costs of land use regulations are due to changes to the cost of commuting rather than housing.
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I propose a shadow price approach to measuring the stringency of land use regulation. A regulation is considered more restrictive if the land developer is willing to pay a larger amount for a marginal relaxation of the regulation. I show that existing theory-based measures of land use stringency are either equivalents or variations of this shadow price measure. Using data from China, I demonstrate that it is possible to compare the stringency of two kinds of land use regulation, a key advantage of this shadow price approach.
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We examine the effects of housing supply constraints on housing affordability, which we measure directly using quality-adjusted rent as well as indirectly using structure sizes, lot sizes and household location choices. Empirically, we find that housing supply constraints have only modest effects on rents and housing consumption despite their larger effects on city growth and the price to purchase homes. Calibration of a dynamic, spatial equilibrium model shows that supply constraints increase price-rent ratios because investors expect future rents to increase more with expected demand growth. Because rent is what matters for affordability, supply constraints have reduced affordability less than is commonly understood despite their sizable effects on the purchase prices of homes.
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The article discusses several aspects of spatial planning systems in Poland and in Italy. The analysis included the legal basis for the functioning of both systems, planning levels and documents developed at each level. The planning status of both countries is presented based on the statistical data obtained. This is shown on the cartodiagrams prepared with the use of ArcGIS and QGIS software as well as tabular lists containing statistical data. Detailed research was also done as a case study for two cities: Olsztyn in Poland and Bari in Italy. The data collected and the analyses carried out made it possible to compare the planning systems in both countries tested. The results show similarities and differences, as well as the positive and negative features of both analyzed systems. Conclusions can be used as a basis for proposing changes to the planning systems in both countries, based on good practices from the other country.
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Housing cost in China has reached an all-time high, preventing millions of people from purchasing a home. Land is a pre-requisite for the housing market. Land-relevant factors such as land regulation, land supply, land price, land use, and mixed land uses have been discussed with respect to land availability and China’s housing price. A nonlinear relationship that affects housing price and land availability is known as the asymmetric effect. Hence, the objective of this study is to investigate the asymmetric effect of land availability on housing price, taking into account GDP, inflation, and interest rate. The NARDL model is employed using the quarterly data from 2005:Q2 to 2017:Q4. The results prove that land availability possesses an asymmetric effect on China’s housing price in the long run. The positive changes in land availability possess a greater effect on the housing price than the negative changes in land availability do. This result implies that policy makers should be inclined to increase the land availability to lower the housing price rather than reducing the land availability to evade housing price hikes. Last, for policy implementation, policy makers should reconsider the demanders’ preferences, the development of mixed land use, and separate regulation of different regions.
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Nimbyism is widely thought to arise from an inherent tradeoff between localism and efficiency in government: because many development projects have spatially concentrated costs and diffuse benefits, local residents naturally oppose proposed projects. But why cannot project developers (with large potential profits) compensate local residents? We argue that local regulatory institutions effectively require developers to expend resources that cannot be used to compensate residents. Not being compensated for local costs, residents therefore oppose development. Using a formal model, we show that when these transaction costs are high, voters consistently oppose development regardless of compensation from developers. But when transaction costs are low, developers provide compensation to residents and local support for development increases. We conclude that nimbyism arises from a bargaining problem between developers and local residents, not the relationship between local decision-making and the spatial structure of costs and benefits. We suggest policy reforms implied by this theory.
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Die Regionalplanung spielt in Deutschland eine zentrale Rolle im Mehrebenensystem der räumlichen Gesamtplanung. Sie konkretisiert planerische Vorgaben auf Landesebene und rahmt die Bauleitplanung auf kommunaler Ebene. Dazu bedient sich die Regionalplanung verschiedener Planungsinstrumente. In diesem Beitrag werden die Ergebnisse einer bundesweiten Untersuchung vorgestellt, die im Rahmen eines von der DFG-geförderten Forschungsprojekts (DFG-Projekt „Der Einfluss der Raumplanung auf die Siedlungsentwicklung in Deutschland und der Schweiz: Eine vergleichende Analyse von Steuerungsfähigkeit und Steuerungswirkungen“ (DI 1641/14-1 Laufzeit 2018–2021). Antragsteller: Prof. Dr. Christian Diller, Justus-Liebig-Universität Gießen; Prof. Dr. Stefan Siedentop, Institut für Landes- und Stadtentwicklungsforschung Nordrhein-Westfalen; Dr. Marco Pütz, Eidg. Forschungsanstalt WSL für Wald, Schnee und Landschaft, Birmensdorf (CH).) durchgeführt wurde. In einer Planinhaltsanalyse wurden hierbei zunächst für jede Planungsregion Gesamtindizes der Regulierungsintensität (RI) der Regionalpläne, differenziert nach positiv- und negativplanerischen Instrumenten, gebildet. Im Ergebnis zeigen sich Unterschiede zwischen, aber auch innerhalb von Bundesländern. Als Ergebnis der Wirkungsanalyse wurde schließlich ermittelt, dass Regionalpläne auch bei gleichzeitiger Berücksichtigung anderer Einflussfaktoren wie der Bevölkerungs- und Beschäftigtenentwicklung einen statistisch signifikanten Einfluss auf die Entwicklung der Gebäude- und Freiflächen ausüben. Dabei ist allerdings die Wirksamkeit der einzelnen Planinstrumente unterschiedlich stark.
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Currently, inequality levels are on the rise although the spatial dimension of social, economic and environmental justice is also gaining prominence. At the same time, progressive institutional changes are underway in many cities and regions. This paper looks at these paradigm shifts through the lenses of sustainable well-being and of spatial justice. It also reflects on the concepts of territorial disparity and scarcity of resources, as well as on the challenges of assessing spatial justice. Finally, the paper discusses the role of spatial planning in tackling these issues, in the light of current approaches to sustainable development such as the circular economy.
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I illustrate how new market-rate construction loosens the market for lower-quality housing through a series of moves. First, I use address history data to identify 52,000 residents of new multifamily buildings in large cities, their previous address, the current residents of those addresses, and so on for six rounds. The sequence quickly reaches units in below-median income neighborhoods, which account for nearly 40 percent of the sixth round, and similar patterns appear for neighborhoods in the bottom quintile of income or percent white. Next, I use a simple simulation model to roughly quantify these migratory connections under a range of assumptions. Constructing a new market-rate building that houses 100 people ultimately leads 45 to 70 people to move out of below-median income neighborhoods, with most of the effect occurring within three years. These results suggest that the migration ripple effects of new housing will affect a wide spectrum of neighborhoods and loosen the low-income housing market.
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This paper examines the causal effect of land use policy on employment growth in Chinese cities. We find that a stricter Floor Area Ratio Regulation (FARR) leads to a reduction in employment growth in Chinese cities-a one standard deviation reduction in FARR leads to a concurrent reduction of employment growth by 1.1-1.6 percentage points. More populated cities and labour-intensive manufacturing industries are found to be more severely affected by stricter FARR. Moreover, the effect of a stricter FARR is found to be less pronounced on state-owned firms compared to foreign-owned and privately-owned firms. Our main conclusions are robust to a variety of sensitivity tests, different instruments and alternative estimators. They suggest that imposing a stricter legal FARR incurs considerable employment costs for Chinese cities. JEL classification: R52 R14 R11
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What features of structural injustice distinguish it from mere collections of injustices committed by individuals? I argue that the standard model of moral judgment that centers agents and actions fails to adequately articulate what’s gone wrong in cases of structural injustice. It fails because features of the social world that arise only at large scale are normatively salient, but unaccounted for by the standard model. I illustrate these features with historical examples of normatively-different outcomes driven by institutional structure rather, holding fixed characteristics of agents’ motivations. I then defend the view from reductionist objections.
Chapter
Eurostat data show that, as of 2016, the CEECs considered here feature in excess of 5.9 million farms making use of agricultural land. However, marked spatial differentiation between one and another was easy enough to discern. By the standards of the EU overall, the Czech Republic and Slovakia can be said to have relatively few farms, while Hungary, Romania and Poland have very many. The total for these three last countries (at around 5.2 million) exceeds the number of farms in all of the remaining EU states. Closely connected with this disparate situation are differences in farm size, given that an average farm in Czechia has more than 130 ha of farmland compared with just 3.6 ha in Romania (Table 6.1).
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Online short-term rental (STR) platforms such as Airbnb have grown spectacularly. We study the effects of regulation of these platforms on the housing market using a quasi-experimental research design. 18 out of 88 cities in Los Angeles County have severely restricted short-term rentals by adopting Home Sharing Ordinances. We apply a panel regression-discontinuity design around the cities’ borders. Ordinances reduced listings by 50% and housing prices by 2%. Additional difference-in-differences estimates show that ordinances reduced rents also by 2%. These estimates imply large effects of Airbnb on property values in areas attractive to tourists (e.g. an increase of 15% within 2.5km of Hollywood’s Walk of Fame).
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Residential development restrictions among Southern California suburban jurisdictions are examined. The purpose of the analysis is to assess the relative importance of various measures of community status, partisanship, and growth as predictors of local policy to regulate residential development. Social status and growth rates appear to account for some of the interurisdictional variation in policy, although it is clear that excluded factors are also important. Several issues regarding the study of local development policy and what might affect findings from study to study are also addressed.
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We discuss instrumental variables (IV) estimation in the broader context of the generalized method of moments (GMM), and describe an extended IV estimation routine that provides GMM estimates as well as additional diagnostic tests. Stand-alone test procedures for heteroskedasticity, overidentification, and endogeneity in the IV context are also described. Copyright 2003 by Stata Corporation.
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This paper was presented at the conference "Policies to Promote Affordable Housing," cosponsored by the Federal Reserve Bank of New York and New York University's Furman Center for Real Estate and Urban Policy, February 7, 2002. It was part of Session 2: Affordable Housing and the Housing Market.
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During the three-year period ending in July 2003, the rise in housing costs in California far exceeded the national inflation rate. Housing prices in five coastal counties increased by more than 60 percent. For the highest quintile of cities, prices increased by an average of more than thirty percent per year. Evidently California housing markets differ along important dimensions from those in the rest of the country. One striking difference is the degree of regulation governing land use and residential construction. California represents the most extreme example of autarky in land use regulations of any U.S. state. Cities are free to set their rules independently, with little oversight. Moreover, state tax policy creates incentives that are likely to decrease production an increase housing costs. Property taxes are constitutionally limited to one percent of acquisition costs while cities are permitted a share of local sales tax receipts. This creates a regulatory incentive to favor retail development over housing construction, to favor development of expensive housing over moderately priced housing, and to discourage the construction of housing.In this paper, we explore the linkages between land-use regulations, growth in the housing stock, and housing prices in California cities. First, we assess whether housing is more expensive in more regulated cities. Next, we assess whether growth in the housing stock over the period of a decade depends on the degree of land-use regulation at the start of the decade. Finally, we estimate the price elasticity of housing supply in regulated and relatively unregulated cities. Our results suggest that current regulations have powerful effects on housing outcomes.
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The efficiency of governments may be influenced by institutional factors and by the intensity of monitoring by citizens. This paper develops a theory of optimal monitoring and then uses frontier estimation techniques to construct measures of efficiency f or police departments in 141 cities. Using these efficiency measures, i t is possible to test the extent to which efficiency is influenced by the presence of a professional city manager and by characteristics of th e citizens. Copyright 1993 by MIT Press.
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Housing prices vary widely between U.S. markets. The purpose of this study is to analyze determinants of housing prices, with particular focus on the effects of regulations in land and housing markets. The basic unit of observation is the city or metropolitan area. The innovative part of the data collection is constructing indexes that reflect regulatory regimes in different markets. The basic method is to model house prices and rents in a simple supply and demand framework focusing on incomes, population changes, "noneconomic" determinants (such as topographical features), and other supply conditions, notably measures of the regulatory environment.
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Why property tax capitalization rates differ: A critical analysis
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J. Martinez, K.R. Ihlanfeldt, Why property tax capitalization rates differ: A critical analysis, Perspectives in Local Public Finance and Public Policy 3 (1987).
Interjurisdictional spillover effects of land use regulations
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M. Cho, P. Linneman, Interjurisdictional spillover effects of land use regulations, Journal of Housing Research 4 (1) (1993) 131–163.
Modeling urban growth controls
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