Journal of Regional Science最新文献

The green bond market is growing substantially, bringing with it a focus on economic and environmental performance. Yet while extensive work exists examining the former, there is little concrete evidence regarding the efficacy of green bond use-of-proceeds. Concurrently, the demand for ESG-compliant investments provides an opportunity to direct capital toward the rehabilitation of one of the most energy-intensive asset classes: real estate. One program in this space, the Fannie Mae Green Rewards green bond program, offers incentives to borrowers to increase multifamily building energy and water efficiency. Although all program participants must complete a set of preapproved projects targeting energy and water efficiency within 12 months of loan origination, there exists substantial variation in the realization of postorigination efficiency outcomes, and in the variation between projected and actual efficiency improvements. We find that fixed interest rates and supplemental financing loan structures are associated with postorigination energy efficiency improvements, as are newer, larger, and high-quality assets. However, the ex ante estimates of efficiency savings provided to prospective investors prove unrelated to the efficiency outcomes. These findings highlight opportunities to improve program transparency and calibration across the green bond universe.

I study house price dynamics following Hurricane Sandy to explain the common puzzling finding of a price drop followed by a complete price recovery. Applying a quasi-experimental difference-in-differences research design on Zillow parcel-level sales data combined with Federal Emergency Management Agency data on damaged structures, I show that the extent of direct damages drives the decline in house prices. The extent of remodeling expenditures, as estimated from building permits, is found to be responsible for causing the return of prices to pre-storm levels. Comparing flood insurance take-up rates in the affected and non-affected areas within floodplains and similarly for outside floodplains, I find no revision in perceived risk in the floodplain. In contrast, there has been an increase in flood insurance take-up rates in affected areas outside of floodplains after the hurricane.

The economic effect of climate hazard events varies by time and by location. This paper investigates how climate shocks to local property markets transmit to capital markets and provides evidence of the extent to which forward-looking climate risk is capitalized into the public valuations of those property markets. We first quantify the exposure of real estate portfolios to locations that recently experienced climate events (Event Exposure). Using an event study framework, we find that, in the post-event period, a one-standard-deviation increase in ex-ante Event Exposure is associated with a 0.2–1.4 percentage points decrease in quarterly stock returns. Cross-sectional analyses reveal that differences in return effects can be explained by variation in the extent to which the area focuses on climate change. Similarly, we find that forward-looking climate risk assessment negatively affects firm valuations only in markets with a focus on climate change. Consistent with these findings, we provide evidence that climate events (shocks) induce retail investors (noise traders) to decrease their stock holdings and that blockholders tend to take the opposite side in these transactions. We also show that conditioning on consumer sentiment helps to explain cross-sectional variation in the response of stock returns to climate events.

This study investigates the capitalization of climate shocks in commercial real estate owned and operated by professional investors. We focus on Hurricanes Harvey and Sandy to quantify the price impacts of climate shocks on commercial buildings in Texas and New York. We find clear evidence of a decline in transaction prices in hurricane-damaged areas after the hurricanes made landfall, compared to unaffected areas. We also observe that the “new news” about climate risk is significantly priced in both states—assets in locations outside the FEMA floodplain (with a lower prior perception of flood risk) that were inundated by the hurricanes experienced larger price discounts, indicating that actual flooding updates investors' perception of flood risk. Moreover, we find that the hurricane discount is more pronounced among buyers with more transaction experience. The transaction price discount also increases with higher climate change beliefs in the local market and among investors. Our findings underline the role of information provision and environmental awareness in the materialization of climate risks' impact on commercial real estate values.

This paper investigates how institutional conditions at national and regional levels shape the decisions of Multinational Enterprises (MNEs) to invest abroad by means of either acquisitions or greenfield investments. The empirical analysis covers all foreign direct investment (FDI) projects in the European Union by the largest MNEs in the world to study alternative choices by the same firm and account for firm-level characteristics in investment decisions. The empirical results show that—other things being equal—regions with stronger investment eco-systems are more likely to attract acquisitions, while greenfield investments are more likely in regions with comparatively weaker systemic conditions. Howerver, the regional quality of institutions makes a fundamental difference to the nature of the investment projects attracted by regions: those with high quality of government can attract greenfield investments undertaken by the most productive MNEs. By improving their quality of government, local, and regional policy makers can attract higher quality greenfield investment projects to their constituencies, potentially breaking the vicious circle between low productivity areas and low productivity FDI.

In this study, we examine the interplay between regional digital financial inclusion and social capital with a focus on social trust. Our empirical analysis shows that regions with enhanced digital financial services experience a significant boost in social trust. Specifically, a one standard deviation increase in regional digital financial inclusion correlates with an approximate increase of 1% in social trust among frequent Internet users compared with infrequent users. We futher find that growth in social trust is largely attributable to noneconomic factors, such as improvements in perceived fairness. Conversely, the economic factor of increased individual income exhibits limited explanatory strength in this context. These findings shed light on the dynamics of regional development and highlight critical policy considerations for fostering social capital through digital finance.

This article aims to incorporate social relations into panel hedonic price modeling analyses, examining how the social conditions of neighborhoods are integrated into local housing markets. To achieve this, we utilize Jefferson County, Kentucky, as a case study and decompose publicly available 311 data, which consist of nonemergency concerns and requests reported by residents, into subcategories to proxy the diverse aspects of social relations. Our findings reveal several key insights: (1) 311 data are characterized by their complexity and encompass a wide range of inputs from residents, necessitating careful interpretation; (2) the overall number of 311 reports may offer limited utility in disclosing social relations; (3) specific categories of 311 reports pertaining to public domain issues hold potential as indicators of social relations. Reports on incivilities, for instance, can serve as proxies for conflicting social relations and exhibit negative impacts on housing prices. Conversely, reports on natural deterioration, environmental concerns, and planning issues demonstrate positive impacts on housing prices, suggesting their utility as indicators for social capital within housing studies.