IDEAS home Printed from https://ideas.repec.org/p/ehl/lserod/64622.html
   My bibliography  Save this paper

The vertical city: the price of land and the height of buildings in Chicago 1870-2010

Author

Listed:
  • Ahlfeldt, Gabriel M.
  • McMillen, Daniel P.

Abstract

We analyze the determinants of building heights in Chicago by combining a micro-geographic data set on tall buildings with a unique panel of land prices covering 140 years. Consistent with the predictions of classic urban economics models, we find that developers respond to increasing land prices by increasing density, i.e. building taller. In 2000, the elasticity of height with respect of land price was about 45% for tall commercial buildings and 30% for tall residential buildings. As expected given significant improvement in construction technology over time, we find that the height elasticity approximately doubled over the last 100 years. We find evidence for dissipative height competition within cities, as excessively tall buildings are significantly less likely to be constructed near to each other than other buildings. Proximity to scenic amenities creates an extra incentive to outrival competitors, particularly in the residential market.

Suggested Citation

  • Ahlfeldt, Gabriel M. & McMillen, Daniel P., 2015. "The vertical city: the price of land and the height of buildings in Chicago 1870-2010," LSE Research Online Documents on Economics 64622, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:64622
    as

    Download full text from publisher

    File URL: http://eprints.lse.ac.uk/64622/
    File Function: Open access version.
    Download Restriction: no
    ---><---

    Other versions of this item:

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Jason Barr & Remi Jedwab, 2023. "Exciting, boring, and nonexistent skylines: Vertical building gaps in global perspective," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 51(6), pages 1512-1546, November.
    2. Raymond Owens III & Esteban Rossi-Hansberg & Pierre-Daniel Sarte, 2020. "Rethinking Detroit," American Economic Journal: Economic Policy, American Economic Association, vol. 12(2), pages 258-305, May.
    3. Ahfeldt, Gabriel M. & Pietrostefani, Elisabetta, 2017. "The compact city in empirical research: A quantitative literature review," LSE Research Online Documents on Economics 83638, London School of Economics and Political Science, LSE Library.
    4. Ahlfeldt, Gabriel M. & Barr, Jason, 2022. "The economics of skyscrapers: A synthesis," Journal of Urban Economics, Elsevier, vol. 129(C).
    5. Jayson Danton & Alexander Himbert, 2017. "Residential Vertical Rent Gradients in the City," Cahiers de Recherches Economiques du Département d'économie 17.11, Université de Lausanne, Faculté des HEC, Département d’économie.
    6. Liu, Crocker H. & Rosenthal, Stuart S. & Strange, William C., 2018. "The vertical city: Rent gradients, spatial structure, and agglomeration economies," Journal of Urban Economics, Elsevier, vol. 106(C), pages 101-122.
    7. Gabriel M. Ahfeldt & Elisabetta Pietrostefani, 2017. "The Compact City in Empirical Research: A Quantitative Literature Review," SERC Discussion Papers 0215, Centre for Economic Performance, LSE.
    8. Federico Curci & Federico Masera, 2018. "Flight from urban blight: lead poisoning, crime and suburbanization," Working Papers 2018/09, Institut d'Economia de Barcelona (IEB).
    9. Barr, Jason & Smith, Fred H. & Kulkarni, Sayali J., 2018. "What's Manhattan worth? A land values index from 1950 to 2014," Regional Science and Urban Economics, Elsevier, vol. 70(C), pages 1-19.

    More about this item

    Keywords

    Chicago; density; height; land value; skyscraper;
    All these keywords.

    JEL classification:

    • R20 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - General
    • R30 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - General

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ehl:lserod:64622. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: LSERO Manager (email available below). General contact details of provider: https://edirc.repec.org/data/lsepsuk.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.