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The urban impacts of the Endangered Species Act: A general equilibrium analysis

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  • Quigley, John M.
  • Swoboda, Aaron M.

Abstract

We consider the general equilibrium implications of environmental regulations which result in a reduction of otherwise profitable residential development. Critical habitat designation under the Endangered Species Act is an important example. If the regulations affect a significant amount of land, they may have important effects on the rest of the regional economy-increasing rents and densities on lands not subject to the regulation, causing the conversion of lands from alternative uses, increasing the net developed area in the region, and decreasing consumer welfare. We develop a flexible general equilibrium simulation of the economic effects of critical habitat designation, explicitly considering the distributional effects upon owners of different types of land and upon housing consumers. The results of our simulation show that the most significant economic effects of critical habitat occur outside of the designated area. The prices and rents of non-critical habitat lands increase significantly. Incomes are redistributed across landlords, and the well being of housing consumers is further affected through these linkages.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Urban Economics.

Volume (Year): 61 (2007)
Issue (Month): 2 (March)
Pages: 299-318

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Handle: RePEc:eee:juecon:v:61:y:2007:i:2:p:299-318

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Web page: http://www.elsevier.com/locate/inca/622905

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References

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  1. Pines, David & Sadka, Efraim, 1986. "Comparative statics analysis of a fully closed city," Journal of Urban Economics, Elsevier, vol. 20(1), pages 1-20, July.
  2. Jan K. Brueckner, 1990. "Growth Controls and Land Values in an Open City," Land Economics, University of Wisconsin Press, vol. 66(3), pages 237-248.
  3. Jeffrey E. Zabel & Robert W. Paterson, 2006. "The Effects of Critical Habitat Designation on Housing Supply: An Analysis of California Housing Construction Activity," Journal of Regional Science, Wiley Blackwell, Wiley Blackwell, vol. 46(1), pages 67-95.
  4. Andrew R. Watkins, 1999. "Impacts of Land Development Charges," Land Economics, University of Wisconsin Press, vol. 75(3), pages 415-424.
  5. Beckmann, Martin J., 1969. "On the distribution of urban rent and residential density," Journal of Economic Theory, Elsevier, vol. 1(1), pages 60-67, June.
  6. Quigley, John M., 2006. "Urban Economics," Berkeley Program on Housing and Urban Policy, Working Paper Series, Berkeley Program on Housing and Urban Policy qt0jr0p2tk, Berkeley Program on Housing and Urban Policy.
  7. C-M Lee & M Fujita, 1997. "Efficient configuration of a greenbelt: theoretical modelling of greenbelt amenity," Environment and Planning A, Pion Ltd, London, vol. 29(11), pages 1999-2017, November.
  8. Thorsnes, Paul, 1997. "Consistent Estimates of the Elasticity of Substitution between Land and Non-Land Inputs in the Production of Housing," Journal of Urban Economics, Elsevier, vol. 42(1), pages 98-108, July.
  9. Brueckner, Jan K., 1987. "The structure of urban equilibria: A unified treatment of the muth-mills model," Handbook of Regional and Urban Economics, Elsevier, in: E. S. Mills (ed.), Handbook of Regional and Urban Economics, edition 1, volume 2, chapter 20, pages 821-845 Elsevier.
  10. Larry D. Singell & Jane H. Lillydahl, 1990. "An Empirical Examination of the Effect of Impact Fees on the Housing Market," Land Economics, University of Wisconsin Press, vol. 66(1), pages 82-92.
  11. Wheaton, William C., 1974. "A comparative static analysis of urban spatial structure," Journal of Economic Theory, Elsevier, vol. 9(2), pages 223-237, October.
  12. Oates, Wallace E. & Schwab, Robert M., 1997. "The Impact of Urban Land Taxation: The Pittsburgh Experience," National Tax Journal, National Tax Association, vol. 50(1), pages 1-21, March.
  13. John M. Quigley, 1984. "The Production of Housing Services and the Derived Demand for Residential Energy," RAND Journal of Economics, The RAND Corporation, vol. 15(4), pages 555-567, Winter.
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Cited by:
  1. Thomas Coisnon & Walid OUESLATI & Julien Salanié, 2012. "Agri-environmental policy and urban sprawl patterns: A general equilibrium analysis," Working Papers halshs-00753221, HAL.
  2. Quigley, John M. & Swoboda, Aaron, 2009. "Land Use Regulation with Durable Capital," Berkeley Program on Housing and Urban Policy, Working Paper Series, Berkeley Program on Housing and Urban Policy qt18w3n3tx, Berkeley Program on Housing and Urban Policy.
  3. Niels Vermeer & Wouter Vermeulen, 2011. "External Benefits of Brownfield Redevelopment: An Applied Urban General Equilibrium Analysis," CPB Discussion Paper 178, CPB Netherlands Bureau for Economic Policy Analysis.
  4. Kok, Nils & Monkkonen, Paavo & Quigley, John M., 2014. "Land use regulations and the value of land and housing: An intra-metropolitan analysis," Journal of Urban Economics, Elsevier, vol. 81(C), pages 136-148.

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