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Housing supply in the presence of informality

Author

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  • Guedes, Ricardo
  • Iachan, Felipe S.
  • Sant’Anna, Marcelo

Abstract

Informal housing refers to the unauthorized residential use of public or private land. In this paper, we study housing supply in markets where informal housing is common. Using a combination of census and satellite data, we estimate housing supply for more than 90 metropolitan areas in Brazil. We find that widespread informal housing increases the housing supply elasticity, partially offsetting the downward pressure of geographical constraints. Our empirical approach is guided by a monocentric city model that includes informal housing. Our identification strategy relies on the use of two novel instruments, combining demographic data and public land ownership.

Suggested Citation

  • Guedes, Ricardo & Iachan, Felipe S. & Sant’Anna, Marcelo, 2023. "Housing supply in the presence of informality," Regional Science and Urban Economics, Elsevier, vol. 99(C).
    • Handle: RePEc:eee:regeco:v:99:y:2023:i:c:s0166046223000108
    DOI: 10.1016/j.regsciurbeco.2023.103875
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    2. Pedro Cavalcanti Ferreira & Alexander Monge-Naranjo & Luciene Torres de Mello Pereira, 2016. "Of Cities and Slums," Working Papers 2016-22, Federal Reserve Bank of St. Louis.

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    More about this item

    Keywords

    Housing supply; Real estate markets; Informality; Slums;
    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
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure

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