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Owners of developed land versus owners of undeveloped land: why land use is more constrained in the Bay Area than in Pittsburgh

Hilber, Christian A. L. and Robert-Nicoud, Frédéric (2006) Owners of developed land versus owners of undeveloped land: why land use is more constrained in the Bay Area than in Pittsburgh. CEP discussion papers, CEPDP0760. Centre for Economic Performance, London School of Economics and Political Science, London, UK. (Unpublished)

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Abstract

We model residential land use constraints as the outcome of a political economy game between owners of developed and owners of undeveloped land. Land use constraints are interpreted as shadow taxes that increase the land rent of already developed plots and reduce the amount of new housing developments. In general equilibrium, locations with nicer amenities are more developed and, as a consequence, more regulated. We test our model predictions by geographically matching amenity, land use, and historical Census data to metropolitan area level survey data on regulatory restrictiveness. Following the predictions of the model, we use amenities as instrumental variables and demonstrate that metropolitan areas with better amenities are more developed and more tightly regulated than other areas. Consistent with theory, metropolitan areas that are more regulated also grow more slowly.

Item Type: Monograph (Discussion Paper)
Official URL: http://cep.lse.ac.uk/pubs/
Additional Information: © 2006 The Authors
Library of Congress subject classification: H Social Sciences > HC Economic History and Conditions
H Social Sciences > HD Industries. Land use. Labor
Journal of Economic Literature Classification System: R - Urban, Rural, and Regional Economics > R5 - Regional Government Analysis > R52 - Land Use and Other Regulations
H - Public Economics > H7 - State and Local Government; Intergovernmental Relations
Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics > Q1 - Agriculture > Q15 - Land Ownership and Tenure; Land Reform; Land Use; Irrigation
Sets: Research centres and groups > Centre for Economic Performance (CEP)
Departments > Geography and Environment
Rights: http://www.lse.ac.uk/library/usingTheLibrary/academicSupport/OA/depositYourResearch.aspx
Identification Number: CEPDP0760
Date Deposited: 18 Apr 2008 10:58
URL: http://eprints.lse.ac.uk/4384/

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