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Making—or Picking—Winners: Evidence of Internal and External Price Effects in Historic Preservation Policies
Author(s) -
Noonan Douglas S.,
Krupka Douglas J.
Publication year - 2011
Publication title -
real estate economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.064
H-Index - 61
eISSN - 1540-6229
pISSN - 1080-8620
DOI - 10.1111/j.1540-6229.2010.00293.x
Subject(s) - extant taxon , quality (philosophy) , economics , control (management) , residential property , property value , public economics , economic geography , finance , philosophy , management , real estate , epistemology , evolutionary biology , biology
This article measures the impacts of historic preservation regulations on property values inside and outside of officially designated historic districts. The analysis relies on a model of historic designation to control for the tendency to designate higher‐quality properties. An instrumental variables model using rich data on historic significance corrects for this bias. The results for Chicago during the 1990s indicate that price impacts from designation inside a landmark district vary considerably across homes inside the districts. Controlling for extant historic quality, which the market values positively, restrictions apparently have negative price effects on average both within and outside districts.