Office space supply restrictions in Britain: the political economy of market revenge

Paul Cheshire and Christian Hilber

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: Office space in Britain is the most expensive in the world and regulatory constraints are the obvious explanation. We estimate the ‘regulatory tax’ for 14 British office locations from 1961 to 2005. These are orders of magnitude greater than estimates for Manhattan condominiums or office space in continental Europe. Exploiting the panel data, we provide strong support for our hypothesis that the regulatory tax varies according to whether an area is controlled by business interests or residents. Our results imply that the cost of the 1990 change converting commercial property taxes from a local to a national basis – transparently removing any fiscal incentive to permit local development – exceeded any plausible rise in local property taxes.

JEL-codes: H3 J6 Q15 R52 (search for similar items in EconPapers)
Date: 2008-06
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Citations: View citations in EconPapers (97)

Published in The Economic Journal, June, 2008, 118(529), pp. F185-F221. ISSN: 0013-0133

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Related works:
Journal Article: Office Space Supply Restrictions in Britain: The Political Economy of Market Revenge (2008)
Journal Article: Office Space Supply Restrictions in Britain: The Political Economy of Market Revenge (2008)
Working Paper: Office Space Supply Restrictions in Britain: The Political Economy of Market Revenge (2007)
Working Paper: Office space supply restrictions in Britain: the political economy of market revenge (2007)
Working Paper: Office Space Supply Restrictions in Britain: The Political Economy of Market Revenge (2007)
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