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Is urban decay bad? Is urban revitalization bad too?

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  • Vigdor, Jacob L.

Abstract

Neighborhood revitalization could, in theory, harm some existing residents if it leads to price increases that exceed their willingness-to-pay. I use data from the American Housing Survey to estimate a discrete choice model identifying households' willingness-to-pay for neighborhood quality. These willingness-to-pay estimates are then compared to the actual price changes that accompany observed changes in neighborhood quality. The results suggest that price increases associated with revitalization are smaller than most households' willingness to pay for neighborhood improvements. Conversely, declines in neighborhood quality are generally not accompanied by rent declines sufficient to compensate the typical resident. For the majority of the population, then, neighborhood revitalization is beneficial and decline detrimental.

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Bibliographic Info

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

Volume (Year): 68 (2010)
Issue (Month): 3 (November)
Pages: 277-289

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Handle: RePEc:eee:juecon:v:68:y:2010:i:3:p:277-289

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

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Keywords: Neighborhood change Capitalization Amenities Gentrification;

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References

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  1. Edward L. Glaeser & Joseph Gyourko, 2005. "Urban Decline and Durable Housing," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 113(2), pages 345-375, April.
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  12. Fernando Ferreira, 2008. "You Can Take it With You: Proposition 13 Tax Benefits, Residential Mobility, and Willingness to Pay for Housing Amenities," Working Papers 08-15, Center for Economic Studies, U.S. Census Bureau.
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Cited by:
  1. Leah Platt Boustan & Devin Bunten & Owen Hearey, 2013. "Urbanization in the United States, 1800-2000," NBER Working Papers 19041, National Bureau of Economic Research, Inc.

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