WWP: Choleric intake is bad for housing prices

I have a confession to make: I haven't had a chance to fully read this week's excellent-looking paper from Attila Ambrus, Erica Field, and Robert Gonzalez. But! A quick skim convinced me that it's cool enough that it's absolutely worth mentioning. This paper invokes several of my favorite things:

1) Regression discontinuity design - I'm up to my ears in an RD paper with a classmate, and I'm coming more and more to appreciate the benefits of this design. Yes, only having a LATE around a certain threshold can be frustrating from an external validity perspective - but the gains in terms of identification seem to strongly outweigh the costs in many cases.

2) John Snow's 19th century medical work! I'm a little bit of a data visualization nerd, and John Snow's original map of London's cholera outbreak, which helped provide convincing evidence that the Broad Street water pump was contaminated and was the source of the contagion is a classic. Beautiful figure, and incredibly clever.

3) A surprising result. This paper finds that the areas that were negatively affected by the cholera-bearing pump in the 19th century still have lower house prices today. Not what I would've expected.

 One of the money figures of the paper: prices are dramatically lower inside the pump's catchment area.

One of the money figures of the paper: prices are dramatically lower inside the pump's catchment area.

All in all, this seems like a really cool paper that I wish I had more time to actually dig into at the moment. I'll leave you with the authors' abstract:

How do geographically concentrated income shocks influence the long-run spatial distribution of poverty within a city? We examine the impact on housing prices of a cholera epidemic in 19th century London in which one in seven families living in one neighborhood experienced the death of a wage earner. Ten years after the epidemic, housing prices are significantly lower just inside the catchment area of the water pump that transmitted the disease, despite being the same before the epidemic. Moreover, differences in housing prices persist and grow in magnitude over the following century. Census data reveal that price changes coincide with a sharp increase in population density at the border, consistent with anecdotes of impoverished residents taking in subtenants to make ends meet. To illustrate a mechanism through which idiosyncratic shocks to individuals that have no direct effect on infrastructure can have a permanent effect on housing prices, we build a model of a rental market with frictions, with poor tenants exerting a negative externality on their neighbors, in which a locally concentrated negative income shock can permanently change the tenant composition of the affected areas.


What's my current excuse for not reading as much as I should?

 Up at Sibley Park before the super blood moon eclipse / fantastic sunset.

Up at Sibley Park before the super blood moon eclipse / fantastic sunset.

Wedding in t-minus 13 (12?) days!

PS: You know you love that pun in the title. You might not admit it out loud, but you do.