Citation

Hornbeck R, Keniston D. Am. Econ. Rev. 2017; 107(6): 1365-1398.

Copyright

(Copyright © 2017, American Economic Association)

DOI

10.1257/aer.20141707

PMID

unavailable

Abstract

Urban growth requires the replacement of outdated buildings, yet growth may be restricted when landowners do not internalize positive spillover effects from their own reconstruction. The Boston Fire of 1872 created an opportunity for widespread simultaneous reconstruction, initiating a virtuous circle in which building upgrades encouraged further upgrades of nearby buildings. Land values increased substantially among burned plots and nearby unburned plots, capitalizing economic gains comparable to the prior value of burned buildings. Boston had grown rapidly prior to the Fire, but negative spillovers from outdated durable buildings had substantially constrained its growth by dampening reconstruction incentives.

Language: en

Keywords

Canada: Pre-1913, Regional Economic Activity: Growth, Development, Environmental Issues, and Changes, Regional Government Analysis: Land Use and Other Regulations, Regional Development Planning and Policy; State and Local Government: Other Expenditure Categories, Regional and Urban History: U.S.