Local Political Power and Housing Bubble in Spain

Marisol Esteban and Amaia Altuzarra
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Marisol Esteban: University of the Basque Country (UPV/EHU)

INVESTIGACIONES REGIONALES - Journal of REGIONAL RESEARCH, 2016, issue 35, 107-127

Abstract: This paper provides empirical evidence of the role of local politicians in the development of the housing bubble in Spain. It intends to determine empirically whether different political ideologies matter and whether municipalities run by different political parties show housing bubbles of different intensity. We work with all municipalities over 25,000 inhabitants. We measure political ideology according to the political party to which the mayor of a municipality belongs. The housing bubble is proxied by the stock of unsold new dwellings. The results suggest an association between the local political ideology and existing unsold new dwellings. Municipalities governed by right-wing mayors have a higher number and share of unsold new dwellings than those governed by centre-left and left-wing mayors.

Keywords: empty dwellings; housing bubble; local power (search for similar items in EconPapers)
JEL-codes: D72 O18 (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:ris:invreg:0319

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