Does Rent Control Turn Tenants Into NIMBYs?

Anselm Hager, Hanno Hilbig and Robert Vief
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Hanno Hilbig: Harvard University

No kwjem, OSF Preprints from Center for Open Science

Abstract: Affordable housing is a key challenge of the 21st century. A pivotal driver of growing housing prices is residents' opposition to construction, a phenomenon known as NIMBYism ("Not In My Backyard"). To make housing more affordable, city governments are increasingly implementing rent control policies. Does rent control---by making tenants more likely to stay in their apartments---spark NIMBYism and thus exacerbate the housing crisis? We study the case of Berlin, which recently passed a sweeping rent control law. Leveraging two discontinuities in the policy, we show that rent control made tenants less NIMBY. Specifically, tenants in rent controlled apartments became more likely to approve of local-level construction and immigration, compared to tenants in non-rent-controlled apartments. We argue that the decline in NIMBYism is likely due to an economic channel. Tenants in urban centers associate construction and immigration with displacement pressures and gentrification. Rent control alleviates these concerns by providing financial and residential security.

Date: 2022-10-26
New Economics Papers: this item is included in nep-ure
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Persistent link: https://EconPapers.repec.org/RePEc:osf:osfxxx:kwjem

DOI: 10.31219/osf.io/kwjem

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