Empty homes, longer commutes: The unintended consequences of more restrictive local planning

Empty homes, longer commutes: The unintended consequences of more restrictive local planning

We investigate the impact of land use regulation on housing vacancy rates. Using a 30-year panel dataset on land use regulation for 350 English Local Authorities (LAs) and addressing potential reverse causation and other endogeneity concerns, we find that tighter local planning constraints increase local housing vacancy rates: a one standard deviation increase in restrictiveness causes the local vacancy rate to increase by 0.9 percentage points (23%). The same increase in local restrictiveness also causes a 6.1% rise in commuting distances. The results underline the interdependence of local housing and Labour markets and the unintended adverse impact of more restrictive planning policies.

Paul C. Cheshire, Christian A.L. Hilber, and Hans R.A. Koster

Journal of Public Economics

February 2018

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By |2018-01-01T00:00:00-08:00January 1st, 2018|Efficiency/Growth, Land Use Regulation, Reference|