Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/267225 
Year of Publication: 
2022
Series/Report no.: 
CESifo Working Paper No. 9992
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
This paper investigates whether and how gentrification spreads along intercity transport connections. We consider a model with heterogeneous individuals populating a primary and a secondary city, with commuting within and between cities. By reducing the cost of intercity commuting, the HSR connection induces migration by skilled individuals towards the secondary city. Therefore, house prices rise in the secondary city, and unskilled individuals are pushed to its periphery. We call this effect second-hand gentrification. We confirm these predictions using the 2017 expansion of the French HSR network from Paris to Bordeaux and Rennes. We find that the HSR connection made skilled Parisians more likely to move to Bordeaux and Rennes, that these individuals locate over-proportionally in central locations of such cities, and that housing prices there consequently increased by €400 per m2 (i.e., 7%). Remarkably, we also find a negative effect on prices in Paris.
Subjects: 
gentrification
high speed rail
housing market
Intercity travel
JEL: 
R23
R11
R41
Document Type: 
Working Paper
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