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Estimating Neighborhood Effects: Evidence from War-time Destruction in London

Author

Listed:
  • Stephen J. Redding

    (Princeton University)

  • Daniel M. Daniel

    (London School of Economics)

Abstract
We use Second World War destruction in London as a natural experiment to provide evidence on neighborhood effects. We use a newly-collected and remarkable dataset on thousands of locations within London that records wartime destruction and the economic and social characteristics of locations from the late nineteenth to late-twentieth centuries. We combine these data with a quantitative model of the sorting of heterogeneous groups of agents across locations that differ in productivity, amenities and transport infrastructure. We find that both own and neighbors' destruction affect patterns of spatial sorting and that the effects of neighbors' destruction are highly localized (0-200 meters). These findings provide evidence for spatial sorting as a mechanism through which neighborhood effects occur.

Suggested Citation

  • Stephen J. Redding & Daniel M. Daniel, 2016. "Estimating Neighborhood Effects: Evidence from War-time Destruction in London," Working Papers 2016-6, Princeton University. Economics Department..
    • Handle: RePEc:pri:econom:2016-6
    as

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    File URL: http://www.princeton.edu/~reddings/papers/LWW2-9Mar16.pdf
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    References listed on IDEAS

    as
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    2. Munroe, Ellen & Nosach, Anastasiia & Pedrozo, Moises & Guarnieri, Eleonora & Riano, Juan Felipe & Tur-Prats, Ana & Valencia Caicedo, Felipe, 2023. "The Legacies of War for Ukraine," CEPR Discussion Papers 17841, C.E.P.R. Discussion Papers.
    3. Hanlon, W.Walker & Heblich, Stephan, 2022. "History and urban economics," Regional Science and Urban Economics, Elsevier, vol. 94(C).
    4. Seltzer, Andrew J. & Wadsworth, Jonathan, 2024. "The impact of public transportation and commuting on urban labor markets: Evidence from the New Survey of London Life and Labour, 1929–1932," Explorations in Economic History, Elsevier, vol. 91(C).
    5. Fetzer, Thiemo, 2023. "Regulatory barriers to climate action : Evidence from Conservation Areas in England," The Warwick Economics Research Paper Series (TWERPS) 1451, University of Warwick, Department of Economics.
    6. Marcos Sanso-Navarro & Guillermo Peña, 2023. "Long-run effects of floods at municipality level in Spain," French Stata Users' Group Meetings 2023 29, Stata Users Group.
    7. Wang, Yixuan, 2024. "Urban Redevelopment and Gentrification: Evidence from the Atlanta BeltLine," 2024 Annual Meeting, July 28-30, New Orleans, LA 343550, Agricultural and Applied Economics Association.
    8. Combes, Pierre-Philippe & Gobillon, Laurent & Zylberberg, Yanos, 2022. "Urban economics in a historical perspective: Recovering data with machine learning," Regional Science and Urban Economics, Elsevier, vol. 94(C).
    9. Nagy, Dávid Krisztián, 2022. "Quantitative economic geography meets history: Questions, answers and challenges," Regional Science and Urban Economics, Elsevier, vol. 94(C).
    10. Jedwab, Remi & Johnson, Noel D. & Koyama, Mark, 2024. "Pandemics and cities: Evidence from the Black Death and the long-run," Journal of Urban Economics, Elsevier, vol. 139(C).

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    More about this item

    Keywords

    Agglomeration Economies; Cities; Neighborhood effects; Second World War;
    All these keywords.

    JEL classification:

    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • N9 - Economic History - - Regional and Urban History
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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