Cream Brown Bag: Rasmus Landersø (Rockwool Foundation Research Unit)

Abstract: We investigate how changes to housing and ownership types shape local neighborhoods in the short and longer run by exploiting a large-scale natural experiment in Copenhagen in 1995 that transformed more than 20,000 public housing units (rental) into coop-ownership housing. Using a differences-in-differences framework, we show that the conversion from rental to coop-ownership induced an inflow of more affluent residents: Within the following 10 years, employment rates of residents in the converted housing units increased by 8 percentage points and disposable income rank increased by 3 percentile points. The changed composition of residents in converted housing units affects the surrounding neighborhood where other residents more often hold a job (4 percentage points) and have higher disposable income rank (3 percentile points). The spillover effects increase with the concentration of converted units. Finally, we show effects on sales prices in the neighborhood where prices of non-converted housing units in neighborhoods with converted units increase by around 10% relative to other neighborhoods in Copenhagen over a 10-year period.

Location: 321 Drayton House or Zoom.

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