Judge for Yourself? The Impact of Controls on Rents in Interwar New York

Ronan Lyons () and Maximilian Guennewig-Moenert ()
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Maximilian Guennewig-Moenert: University of Cologne

No tep0924, Economic Papers from Trinity College Dublin, Economics Department

Abstract: This paper examines the impact of early 20th-century rent control laws in New York City (NYC), using a Regression Discontinuity Design (RDD) to analyze the effects on market rents near municipal court district boundaries. We focus on rent regulations introduced in 1920, where judges had discretion to determine rent increases and did so influenced by their partisan affiliations. Using a dataset of over 12,000 rental listings from the New York Times and records of 125 district judges, we find that market rents jumped by almost 10% crossing from Democrat- to Republican-controlled districts after the policy was implemented. A causal interpretation is supported not only by a rich set of controls but also by the lack of any discontinuity just before these controls were introduced or after. Our findings contribute new evidence on judicial discretion's role in shaping housing market outcomes and provide insights into early rent control policies, highlighting their distortionary effects on rental markets before World War II.

Keywords: Rent control; New York City; 1920s (search for similar items in EconPapers)
JEL-codes: O18 R21 R31 (search for similar items in EconPapers)
Pages: 48 pages
Date: 2024-11
New Economics Papers: this item is included in nep-his, nep-law and nep-ure
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