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Game of Zones: The Political Economy of Conservation Areas

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  • Gabriel M. Ahlfeldt
  • Kristoffer Möller
  • Sevrin Waights
  • Nicolai Wendland

Abstract

Provided there are positive external benefits attached to the historic character of buildings, owners of properties in designated conservation areas benefit from a reduction in uncertainty regarding the future of their area. At the same time, the restrictions put in place to ensure the preservation of the historic character limit the degree to which properties can be altered and thus impose a cost to their owners. We test a simple theory of the designation process in which we postulate that the level of designation is chosen to comply with interests of local homeowners. The implication of the model is that a) an increase in preferences for historic character should increase the likelihood of a designation, and b) new designations at the margin should not be associated with significant house price capitalization effects. Our empirical results are in line with these predictions.

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Bibliographic Info

Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 4755.

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Date of creation: 2014
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Handle: RePEc:ces:ceswps:_4755

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Keywords: designation; difference-in-difference; RDD-DD; England; gentrification; heritage; property value;

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References

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Cited by:
  1. Kristoffer Moeller, 2013. "Culturally clustered or in the cloud? Location of internet start-ups in Berlin," ERSA conference papers ersa13p455, European Regional Science Association.

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