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JUE Insight: Measuring the Stringency of Land Use Regulation Using a Shadow Price Approach

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  • Zhang, Junfu

Abstract

I propose a shadow price approach to measuring the stringency of land use regulation. A regulation is considered more restrictive if the land developer is willing to pay a larger amount for a marginal relaxation of the regulation. I show that existing theory-based measures of land use stringency are either equivalents or variations of this shadow price measure. Using data from China, I demonstrate that it is possible to compare the stringency of two kinds of land use regulation, a key advantage of this shadow price approach.

Suggested Citation

  • Zhang, Junfu, 2023. "JUE Insight: Measuring the Stringency of Land Use Regulation Using a Shadow Price Approach," Journal of Urban Economics, Elsevier, vol. 133(C).
    • Handle: RePEc:eee:juecon:v:133:y:2023:i:c:s0094119022000389
    DOI: 10.1016/j.jue.2022.103461
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    More about this item

    Keywords

    Land use; Regulation; Stringency; Shadow price;
    All these keywords.

    JEL classification:

    • R14 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Land Use Patterns
    • R52 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Land Use and Other Regulations

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