Land use regulation and productivity—land matters: evidence from a UK supermarket chain
- *Department of Geography and Environment & Spatial Economics Research Centre, The London School of Economics and Political Science, Houghton Street, London WC2A 2AE, UK
- **Regional Development Policy Division, Directorate for Public Governance and Territorial Development, Organisation for Economic Co-operation and Development, rue André Pascal, 75116 Paris, France & Spatial Economics Research Centre, The London School of Economics and Political Science, Houghton Street, London WC2A 2AE, UK
- ↵†Corresponding author: Paul C. Cheshire. email <p.cheshire{at}lse.ac.uk>
- Received May 2, 2012.
- Accepted March 9, 2014.
Abstract
We use store-specific data for a UK supermarket chain to estimate the impact of planning on store output. Exploiting the variation in policies between England and other UK countries, we isolate the impact of Town Centre First (TCF) policies introduced in England. We find they directly reduced output by forcing stores onto less productive sites. We estimate TCF policies imposed a loss of output of 32% on a representative store opening after their rigorous implementation in 1996. Additionally, we show that, household numbers constant, more restrictive local authorities have fewer stores and lower chain sales within their areas.
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