Superstar Cities

Joseph Gyourko, Christopher Mayer and Todd Sinai

American Economic Journal: Economic Policy, 2013, vol. 5, issue 4, 167-99

Abstract: We document large long-run differences in average house price appreciation across metropolitan areas over the past 50 years, and show they can be explained by an inelastic supply of land in some unique locations combined with an increasing number of highincome households nationally. The resulting high house prices and price-to-rent ratios in those "superstar" areas crowd out lower income households. The same forces generate a similar pattern among municipalities within a metropolitan area. These facts suggest that disparate local house price and income trends can be driven by aggregate demand, not just changes in local factors such as productivity or amenities.

JEL-codes: R11 R23 R31 R52 (search for similar items in EconPapers)
Date: 2013
Note: DOI: 10.1257/pol.5.4.167
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Citations: View citations in EconPapers (170)

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Working Paper: Superstar Cities (2006)
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