Estimating the Effect of Land Use Regulation on Land Price : At the Kink Point of Building Height Limits in Fukuoka

This study estimates the effect of land use regulation on land price by exploiting the feature of building height limits of the aviation law in Fukuoka, Japan. The law limits the building height within 4000 meters of an airport to 54.1 m, but when the distance exceeds 4000 meters, the limits are relaxed. Exploiting this regulation feature, we estimate the effect of the regulation on land price using the regression kink design. We find that building height restriction has a significantly negative effect on land price and the magnitude of the effects depends on the stringency of regulation