Discussion Paper Details

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Title: Game of zones: The political economy of conservation areas

Author(s): Gabriel Ahlfeldt, Kristoffer Möller, Sevrin Waights and Nicolai Wendland

Publication Date: March 2016

Keyword(s): Designation, Difference-in-Differences, England, Gentrification, Heritage and Property Value

Programme Area(s): International Trade and Regional Economics and Public Economics

Abstract: We develop and test a simple theory of the conservation area designation process in which we postulate that the level of designation is chosen to comply with interests of local homeowners. Conservation areas provide benefits to local homeowners by reducing uncertainty regarding the future of their area. At the same time, the restrictions impose a cost by limiting the degree to which properties can be altered. In line with our model predictions we find that an increase in preferences for historic character by the local pop-ulation increases the likelihood of a designation, and that new designations at the margin are not associat-ed with significant house price capitalisation effects.

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Bibliographic Reference

Ahlfeldt, G, Möller, K, Waights, S and Wendland, N. 2016. 'Game of zones: The political economy of conservation areas'. London, Centre for Economic Policy Research.