Elisabetta Pietrostefani (p)

Eduardo Haddad

Conservation planning solves an economic coordination problem by internalizing negative externalities i.e. loss of urban heritage. Non-compliance undermines these effects, but little is known how much harm it actually does. This paper exploits the Italian context to examine these relationships, given that despite stringent planning regulation, the conditions of the urban environment vary widely throughout the country, including within protected areas. Using a novel dataset of property prices for 55 Italian cities and a boundary discontinuity design, the first step of this paper explores the variation in price premiums across 933 Landscape Areas and 236 Historic Centres. Comparing the differences in property prices along the boundaries of both Landscape Areas and Historic Centres, I find an average capitalisation effect of 7% and 3.5% respectively. In line with model predictions, heterogeneous patterns in premiums are found across Italian cities, with distinct trends according to geographical location. Premiums are on average significantly lower in regions with higher rates of abusivimo – illegal building and construction – suggesting the influence of informal institutions. In the second step and by using an instrumental strategy to substantiate estimates, results confirm that at least partially, illegal building and construction levels explain this heterogeneity.

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Marco Di Cataldo (p), Filippo Boeri , Elisabetta Pietrostefani

Eduardo Haddad

Can anti-mafia policies contribute to local regeneration? In an effort to tackle criminal groups, the Italian State allows the confiscation of properties belonging to individuals convicted for mafia-related crimes, and their re-allocation to a new use. The policy is considered both as a preventive measure and as a way to partially compensate the society for the harm made by the criminal organisations. Whether and how this measure
has been beneficial for the wider society, however, has not yet been investigated. We test the hypothesis that the policy is able to produce positive externalities on the local community by influencing property prices in the surroundings of confiscated/reallocated properties. To this aim, we first conduct an exploratory analysis on the whole Italian territory, implementing a differences-in-differences strategy at the level of local housing markets. Next, we adopt micro geo-localised data on house sales in all major Italian cities to estimate a hedonic pricing model assessing the effect of re-allocations on the value of surrounding buildings, up to a distance between 100m and 500m. The results unveil a positive and significant effect of re-allocations of confiscated properties, declining with distance. Magnitude and spatial decay are found to vary considerably depending on property type and environmental characteristics. Our research sheds new light on the spatial externalities of institutional signals and on the societal implications of initiatives against organised crime.

Sander Ramboer (p), Lorenz Fischer

Eduardo Haddad

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