Office Space Supply Restrictions in Britain: The Political Economy of Market Revenge
AbstractOffice space in Britain is the most expensive in the world and regulatory constraints are the obvious explanation. We estimate the ‘regulatory tax’ for 14 British office locations from 1961 to 2005. These are orders of magnitude greater than estimates for Manhattan condominiums or office space in continental Europe. Exploiting the panel data, we provide strong support for our hypothesis that the regulatory tax varies according to whether an area is controlled by business interests or residents. Our results imply that the cost of the 1990 change converting commercial property taxes from a local to a national basis – transparently removing any fiscal incentive to permit local development – exceeded any plausible rise in local property taxes.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 5435.
Date of creation: 18 Apr 2007
Date of revision:
Land use regulation; regulatory costs; business taxation; office markets;
Other versions of this item:
- Paul C. Cheshire & Christian A.L. Hilber, 2008. "Office Space Supply Restrictions in Britain: The Political Economy of Market Revenge," Economic Journal, Royal Economic Society, vol. 118(529), pages F185-F221, 06.
- H3 - Public Economics - - Fiscal Policies and Behavior of Economic Agents
- Q15 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Land Ownership and Tenure; Land Reform; Land Use; Irrigation; Agriculture and Environment
- J6 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers
- R52 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Land Use and Other Regulations
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-10-27 (All new papers)
- NEP-EEC-2007-10-27 (European Economics)
- NEP-GEO-2007-10-27 (Economic Geography)
- NEP-REG-2007-10-27 (Regulation)
- NEP-URE-2007-10-27 (Urban & Real Estate Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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NBER Working Papers
12355, National Bureau of Economic Research, Inc.
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