Quantifying Land Use Regulation and its Determinants - Ease of Residential Development across Swiss Municipalities

We analyze land use regulation and the determinants thereof across the majority of Swiss municipalities. Based on a comprehensive survey, we construct several indices on the ease of local residential development, which capture various aspects of local regulation and land use coordination across jurisdictions. The indices provide harmonized information about what local regulation entails and the local regulatory environment across municipalities. Our analysis shows that, among others, historical building density, socio-demographic factors, local taxes, cultural aspects, and the quality of natural amenities are important determinants of local land-use regulation. We test the validity of the index with regard to information about the local refusal rates of development projects and show that the index captures a significant part of the variation in local housing supply elasticities. Based on a machine learning cross-validation model, we impute the values for non-responding municipalities

Place-based policies and spatial disparities across European cities

Spatial disparities in income levels and worklessness in the European Union are profound, persistent and may be widening. We describe disparities across metropolitan regions and discuss theories and empirical evidence that help us understand what causes these disparities. Increases in the productivity benefits of cities, the clustering of highly educated workers and increases in their wage premium all play a role. Europe has a long-standing tradition of using capital subsidies, enterprise zones, transport investments and other place-based policies to address these disparities. The evidence suggests these policies may have partially offset increasing disparities but are not sufficient to fully offset the economic forces at work

Spatial frictions in consumption and retail competition

In this paper, we empirically quantify spatial consumption frictions and the degree of local retail competition. We exploit a unique data set including 1.5 billion daily transactions in combination with detailed characteristics of more than 3 million households. Our estimates are based on a quasi-experimental approach to estimate the causal effect of store openings. We find that a same-chain store opening in the proximity of households' residences reduces their expenditures at incumbent stores by 30% in the first month. Smaller effects for competitors suggest imperfect substitutability between retail chains. Exploiting more than 350 openings, we identify causal consumption gravity functions, which allow us to quantify spatial consumption areas. We document significant heterogeneities across regions and socio-demographic groups, indicating substantial inequalities in consumption access

The amplifying effect of capitalization rates on housing supply

We provide empirical evidence that increases in housing rental income lead to a larger supply response than price increases of the same percentage value. We rationalize this differential in supply responsiveness with an amplification mechanism arising from a downward revision of capitalization rates following a rental income increase. We document that the amplification of the housing supply price elasticity is less pronounced in geographically constrained and tightly regulated neighborhoods and areas having more sophisticated investors. Our findings hold valuable lessons for public policies affecting the housing rental income, such as rent control and housing subsidies

The Fragility of Urban Social Networks - Mobility as a City Glue -

Social interactions are crucial to a city's cohesion, and the high frequency of interaction reflects many benefits of density. However, adverse environmental conditions, such as pollution or pandemics, may critically affect these interactions as they shift preferences over meeting locations and partners. Some interactions may be shifted to the virtual space, while other non-planned interactions may disappear. We analyze spatial interaction networks in Singapore covering about half of the adult population at a fine-grained spatial resolution to understand the importance of population mixing and places' amenities for urban network resilience. We document that environmental shocks negatively affect total interactions. Still, conditional on meeting physically, the number and type of location options may crucially impact the intensity and type of social interactions. The interplay between preferences for meetings partners, locations, and mobility determines population mixing and the fragility of urban social networks

Institutional settings and urban sprawl: evidence from Europe

This article explores the role of institutional settings in determining spatial variation in urban sprawl across Europe. We first synthesize the emerging literature that links land use policies and local fiscal incentives to urban sprawl. Next, we compile a panel dataset on various measures of urban sprawl for European countries using high-resolution satellite images. We document substantial variation in urban sprawl across countries. This variation remains roughly stable over the period of our analysis (1990-2012). Urban sprawl is particularly pronounced in emerging Central and Eastern Europe but is comparatively low in Northern European countries. Urban sprawl – especially outside functional urban areas – is strongly negatively associated with real house price growth, suggesting a trade-off between urban containment and housing affordability. Our main novel empirical findings are that decentralization and local political fragmentation are significantly positively associated with urban sprawl. Decentralized countries have a 25 to 30 percent higher sprawl index than centralized ones. This finding is consistent with the proposition that in decentralized countries fiscal incentives at local level may provide strong incentives to permit residential development at the outskirts of existing development

On the optimal design of place-based policies: A structural evaluation of EU regional transfers

We quantify general equilibrium effects of place-based policies in a multi-region framework with population mobility, trade and agglomeration economies. Using detailed data on EU transfers, we estimate the local effects of different transfer types on productivity, income and transportation costs. Integrating these estimates into the model, we derive the spatial distribution of economic activity and corresponding welfare that would have materialized without transfers. We show that EU transfers have improved welfare. Substantial further welfare gains could be reached by reallocating funds across regions without increasing the budget. We identify the welfare-optimal spatial distribution for each transfer type and show that wage subsidies should rather be directed to few poor and peripheral regions while investments in transport infrastructure are most efficient in highly productive and/or central regons

Wenn die Nachfrage nicht gedeckt werden kann, bremst dies die Wirtschaft (Radiointerview von Janik Lanz)

Der Welthandel in der Krise Egal ob Autos, Smartphones oder sonstige Unterhaltungselektronik wie TV oder Tablet. Was ein Mikrochip drin hat, ist in der Produktion aktuell von Engpässen betroffen. Aber nicht nur diese oder generell Einzelteile fehlen, sondern auch ganze Güter, wie unter anderem Velos sind davon betroffen. Die finanziellen Folgen sind enorm. Wie gross sie konkret sind, ist noch unbekannt. "Das ganze hängt natürlich stark vom Verlauf der Coronapandemie ab", erklärt Maximilian von Ehrlich. Professor für Volkswirtschaftslehre an der Universität Bern. "Das spielen viele Effekte mit rein. Die Frage ist, wie der weitere Verlauf ist. Wo potentiell zukünftige Lockdowns und Quarantäne gelten werden. Aktuell zum Beispiel Singapur, wichtiger Hafen in Asien, gehen die Coronazahlen aktuell in die Höhe. Dies beeinflusst dann auch die Kosten." Aus diesem Grund sei es nur schwer abzuschätzen, was es insgesamt braucht, um die daraus entstandenen Schäden zu begleichen. Vor allem gerade deshalb, weil das Ende noch nicht ausgestanden ist und die Massnahmen an manchen Orten noch strenger sind, ergänzt von Ehrlich. Auch die Dauer, wie lange die Krise noch andauert, sei nur schwer vorherzusagen, erklärt von Ehrlich. Viel mehr müsse eine Lösung gefunden werden, wie man sich künftig vor solchen Ereignissen schützen kann

Wirtschaftsraum Bern unter der Lupe (Interview von Sascha Funk und Reto Liniger)

BAK Economics hat erstmals ein umfassendes Monitoring zum Wirtschaftsstandort Bern erstellt. Auf eine Diagnose eine Zweitmeinung einzuholen, ist meist zu empfehlen. Und so haben wir Professor Aymo Brunetti kontaktiert, den Direktor des Departements Volkswirtschaft der Universität Bern. Welche Schlüsse und Interpretationen zieht er aus dem Monitoring? Professor Brunetti hat uns an seinen Kollegen Professor Maximilian von Ehrlich verwiesen, er sei spezialisiert auf regionalökonomische Fragen und Analysen. Im Gespräch erklärt Professor von Ehrlich, was ihm am Monitoring fehlt, ob der Wirtschaftsraum Bern abhängig von der EU ist und was er von der Zukunft erwarten kann