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- Title
Getting high or getting low? the external effects of coffeeshops on house prices.
- Authors
Langen, Mike; Aydin, Erdal; Eichholtz, Piet; Kok, Nils
- Abstract
Cannabis legalization is a hotly contested policy topic. While beneficial to some, cannabis dispensaries may create negative externalities for others. This paper studies the external effects of coffeeshops—Dutch cannabis sales facilities—on house prices. We employ a difference‐in‐difference framework around a change in regulation, leading to exogenous coffeeshop closings. We find that closings have a negative effect on house prices. Compared to homes nearby remaining coffeeshops, homes nearby closing coffeeshops decrease on average 1.6–8.5% in value. The findings are robust to a battery of tests and unaffected by the subsequent use of coffeeshop locations.
- Subjects
HOME prices; COFFEE shops; MARIJUANA industry; RESIDENTIAL real estate
- Publication
Real Estate Economics, 2022, Vol 50, Issue 2, p565
- ISSN
1080-8620
- Publication type
Article
- DOI
10.1111/1540-6229.12365