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The economics of conservation area designation

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  • Gabriel Ahlfeldt

    ()

  • Kristoffer Moeller

    ()

  • Sevrin Waights

    ()

  • Nicolai Wendland

    ()

Abstract

Provided that 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 optimal level of designation is chosen so to Pareto-maximize the welfare of local owners. 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 expectations.

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Bibliographic Info

Paper provided by European Regional Science Association in its series ERSA conference papers with number ersa13p87.

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Date of creation: Nov 2013
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Handle: RePEc:wiw:wiwrsa:ersa13p87

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Related research

Keywords: Heritage; Hedonic Modelling; Difference-in-Difference; Gentrification; England; Value;

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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, European Regional Science Association ersa13p455, European Regional Science Association.
  2. Gabriel Ahlfeldt & Pantelis Koutroumpis & Tommaso Valletti, 2014. "Speed 2.0. Evaluating access to universal digital highways," CEIS Research Paper, Tor Vergata University, CEIS 328, Tor Vergata University, CEIS, revised 05 Sep 2014.

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