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Land-use regulation and housing supply elasticity: evidence from France

Author

Listed:
  • Guillaume Chapelle
  • J.B. Eyméoud
  • C. Wolf

    (Université de Cergy-Pontoise, THEMA)

Abstract

This study gathered original data on French metropolitan statistical areas to estimate and decompose their inverse housing supply elasticity, describing how housing prices react to demand shocks. Our findings confirm that French cities are highly inelastic, with an estimated average supply elasticity of 0.5. Furthermore, leveraging a nationwide regulation protecting historical monuments as an instrument, we found that land-use regulations controlled by local authorities appear to be mainly responsible for this low supply elasticity.

Suggested Citation

  • Guillaume Chapelle & J.B. Eyméoud & C. Wolf, 2023. "Land-use regulation and housing supply elasticity: evidence from France," THEMA Working Papers 2023-08, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
    • Handle: RePEc:ema:worpap:2023-08
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    File URL: https://thema.u-cergy.fr/IMG/pdf/2023-08.pdf
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    References listed on IDEAS

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    More about this item

    Keywords

    housing supply; land use regulation; real estate; urban growth.;
    All these keywords.

    JEL classification:

    • R31 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Housing Supply and Markets
    • R52 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Land Use and Other Regulations
    • R21 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Housing Demand

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