Housing Constraints and Spatial Misallocation | Zendy

ChangTai Hsieh | Zendy; Enrico Moretti | Zendy

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Housing Constraints and Spatial Misallocation

Author(s) -

ChangTai Hsieh,

Enrico Moretti

Publication year - 2019

Publication title -

american economic journal macroeconomics

Language(s) - English

Resource type - Journals

SCImago Journal Rank - 10.443

H-Index - 61

eISSN - 1945-7707

pISSN - 1945-7715

DOI - 10.1257/mac.20170388

Subject(s) - metropolitan area , productivity , limiting , economics , aggregate (composite) , bay , spatial mismatch , econometrics , labour economics , geography , macroeconomics , engineering , mechanical engineering , materials science , archaeology , composite material

We quantify the amount of spatial misallocation of labor across US cities and its aggregate costs. Misallocation arises because high productivity cities like New York and the San Francisco Bay Area have adopted stringent restrictions to new housing supply, effectively limiting the number of workers who have access to such high productivity. Using a spatial equilibrium model and data from 220 metropolitan areas we find that these constraints lowered aggregate US growth by more than 50% from 1964 to 2009.

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