Essays in Spatial Economics
2020-07
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Essays in Spatial Economics
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2020-07
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Chapter 1 examines how land market frictions can hinder the growth of manufacturing firms in developing economies. Land market frictions are the result of increased land fragmentation, poor land records, and restrictive land use policies. Using manufacturing census from India with unique land data, I document that in regions with smaller land parcel size, firms acquire many small parcels slowly over time, expand building with 4% lower probability, and are 22% smaller in size. I build a dynamic structural model that flexibly captures firm land adjustment costs which vary with the size of adjustment and region. I find that land frictions reduce lifetime producer profits by 6.5%. In some regions, firms pay 119% in additional land aggregation costs over and above the dollar value of land. My results are also consistent with the hypothesis that government-affiliated firms face lower land frictions. I find that private firms pay three times more for land aggregation than government-affiliated firms. I use the model to analyze the effects of a proposed government land-pooling policy on producer profits, firm growth, and land misallocation; and to quantify the expected losses to firms from the 2015 eminent domain restrictions. In Chapter 2, William Speagle, Kevin Ehrman-Solberg and I study racial covenants which were clauses in property deeds that prohibited the sale or renting of a property to specific religious and ethnic minorities. This paper studies the effect of racially-restrictive covenants, prevalent during the early-to-mid 20th century, on present-day socioeconomic outcomes such as house prices and racial segregation. Using a newly created geographic data on over 120,000 historical property deeds with information on racial covenant use from Hennepin County, Minnesota, we exploit the unanticipated 1948 Supreme Court ruling that made racially-restrictive covenants unenforceable. We employ a regression discontinuity around the ruling to document the causal and time-persistent effects of racial covenants on present-day socioeconomic geography of Minneapolis. In particular, we document that houses that were covenanted have on average 15% higher present-day house values compared to properties which were not covenanted. We also find a 1% increase in covenanted houses in a census blocks reduces black residents by 14% and reduces black home ownership by 19%.
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University of Minnesota Ph.D. dissertation.July 2020. Major: Economics. Advisor: Thomas Holmes. 1 computer file (PDF); x, 104 pages.
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Sood, Aradhya. (2020). Essays in Spatial Economics. Retrieved from the University Digital Conservancy, https://hdl.handle.net/11299/216335.
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