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Measuring the Stringency of Land Use Regulation: The Case of China's Building Height Limits

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Listed:
  • Jan K. Brueckner

    (UC Irvine)

  • Shihe Fu

    (WangYanan Institute for Studies in Economics, Xiamen University)

  • Yizhen Gu

    (Institute for Economic and Social Research, Jinan University)

  • Junfu Zhang

    (Clark University)

Abstract

This paper develops a new approach for measuring the stringency of a major form of land use regulation, building height restrictions, and applies it to an extraordinary data set of land-lease transactions from China. Our theory shows that the elasticity of land price with respect to the floor area ratio (FAR), a building height indicator, is a measure of the regulation's stringency (the extent to which FAR is kept below the free-market level). Using a national sample, estimation allowing this elasticity to be city-specific shows variation in the stringency of FAR regulation across Chinese cities. Single-city estimation for Beijing shows that stringency varies with site characteristics.

Suggested Citation

  • Jan K. Brueckner & Shihe Fu & Yizhen Gu & Junfu Zhang, 2017. "Measuring the Stringency of Land Use Regulation: The Case of China's Building Height Limits," The Review of Economics and Statistics, MIT Press, vol. 99(4), pages 663-677, July.
  • Handle: RePEc:tpr:restat:v:99:y:2017:i:4:p:663-677
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    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. In a City FAR, FAR Away: Building Height Regulations and Their Impacts
      by Jason Barr in Skynomics Blog on 2020-03-17 12:17:31

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    Cited by:

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    3. Ahlfeldt, Gabriel M. & Barr, Jason, 2020. "The economics of skyscrapers: a synthesis," LSE Research Online Documents on Economics 108469, London School of Economics and Political Science, LSE Library.
    4. Tideman, Nicolaus & Plassmann, Florenz, 2018. "The effects of changes in land value on the value of buildings," Regional Science and Urban Economics, Elsevier, vol. 69(C), pages 69-76.
    5. Camilo Andrés Acosta Mejía, 2021. "The Incidence of Land Use Regulations," Documentos de Trabajo CIEF 019223, Universidad EAFIT.
    6. Fu, Shihe & Xu, Xiaocong & Zhang, Junfu, 2021. "Land conversion across cities in China," Regional Science and Urban Economics, Elsevier, vol. 87(C).
    7. Kono, Tatsuhito & Sega, Kousuke & Seya, Hajime, 2020. "Estimating the willingness to pay for urban esthetic projects using an inter-temporal equilibrium: a difference-in-differences hedonic approach," MPRA Paper 102064, University Library of Munich, Germany.
    8. Gabriel M. Ahfeldt & Elisabetta Pietrostefani, 2017. "The Compact City in Empirical Research: A Quantitative Literature Review," SERC Discussion Papers 0215, Spatial Economics Research Centre, LSE.
    9. He, Qingsong & Xu, Min & Xu, Zike & Ye, Yanmei & Shu, Xianfan & Xie, Peng & Wu, Jiayu, 2019. "Promotion incentives, infrastructure construction, and industrial landscapes in China," Land Use Policy, Elsevier, vol. 87(C).
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    12. Roland Füss & Jan A. Koller & Alois Weigand, 2021. "Determining Land Values from Residential Rents," Land, MDPI, Open Access Journal, vol. 10(4), pages 1-29, March.

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    More about this item

    JEL classification:

    • R14 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Land Use Patterns
    • R52 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Land Use and Other Regulations

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