Built out cities? A new approach to measuring land use regulation

Paavo Monkkonen, Michael Manville and Michael Lens

Journal of Housing Economics, 2024, vol. 63, issue C

Abstract: We introduce a new way to measure the stringency of housing regulation. Rather than a standard regulatory index or a single aspect of regulation like Floor Area Ratio, we draw on cities’ self-reported estimates of their total zoned capacity for new housing. This measure, available to us as a result of state legislation in California, offers a more accurate way to assess local antipathy toward new housing, and also offers a window into how zoning interacts with existing buildout. We show, in regressions analyzing new housing permitting, that our measure has associations with new supply that are as large or larger than conventional, survey-based indexes of land use regulation. Moreover, unbuilt zoning capacity interacts with rent to predict housing production in ways conventional measures do not. Specifically, interacting our measure with rent captures the interplay of regulation and demand: modest deregulation in high-demand cities is associated with substantially more housing production than substantial deregulation in low-demand cities. These findings offer a more comprehensive explanation for the historically low levels of housing production in high cost metros.

Keywords: Land use regulation; Measurement; Housing production (search for similar items in EconPapers)
JEL-codes: R15 R31 R38 R52 (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S1051137724000019
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:jhouse:v:63:y:2024:i:c:s1051137724000019

DOI: 10.1016/j.jhe.2024.101982

Access Statistics for this article

Journal of Housing Economics is currently edited by H. O. Pollakowski

More articles in Journal of Housing Economics from Elsevier
Bibliographic data for series maintained by Catherine Liu ().