Rémi Jedwab, Jason M. Barr, Jan K. Brueckner, 28 February 2021

Housing prices in many countries are growing faster than incomes. Much of this affordability problem can be explained by regulatory barriers to new construction. This column calculates countries’ ‘building-height gaps’ – the difference between the total height of a country’s stock of tall buildings and what the total height would have been if building height regulations were relatively less stringent, based on parameters from a benchmark set of countries. These gaps are larger for richer countries and for residential buildings rather than for commercial buildings, and they correlate strongly with housing prices, sprawl, congestion, and pollution. 

Gabriel Ahlfeldt, Jason M. Barr, 20 August 2020

The economic case for supertall buildings has been challenged since the late 19th century. Critics urge policymakers to control vertical growth, arguing that skyscrapers are often built to satisfy oversized egos rather than serving economic purposes. This column contends that economic fundamentals are strong predictors of building heights. Height competition can lead to extremely tall buildings that aim at pre-empting rivals, but these are the exception rather than the rule. In regulating heights, policymakers should focus on balancing the positive and negative externalities associated with tall buildings.

Gabriel Ahlfeldt, Daniel McMillen, 04 November 2017

Cities around the world are experiencing unprecedented vertical growth, but there has been little study of the economics of tall buildings. This column summarises novel evidence on the determinants of the urban height profile and the cost of building tall, and derives implications for urban theory and policy. In contrast to standard urban economics models, there is a role for the supply side in determining horizontal land use patterns. Vertical expansion is unlikely to resolve affordability problems in growing cities.

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