Large-scale affordable housing construction and public goods provision: evidence from Iran†

Saeed Tajrishy and Mohammad Vesal

Journal of Economic Geography, 2024, vol. 24, issue 1, 171-189

Abstract: Affordable housing projects may affect neighboring property values. Negative spillovers are more likely in developing countries because governments may fail to provide complementary infrastructures such as schools. We study one of the world’s largest affordable housing projects, the Mehr housing project in Iran, which facilitated the construction of 2 million affordable apartments. Using the universe of house transactions in nineteen large cities, we employ a difference-in-differences methodology to estimate the causal impact of Mehr on neighboring properties. Results show nearby housing prices fall by 11%. This negative effect fades away in neighborhoods that saw a proportionate expansion of schools.

Keywords: affordable housing; schooling; housing externality; Iran; Mehr housing project (search for similar items in EconPapers)
JEL-codes: H23 H43 R31 R38 (search for similar items in EconPapers)
Date: 2024
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