May 16, 2006

Housing supply and the interaction of regional population and employment

Woningaanbod stuurt ruimtelijke verdeling bevolking en werkgelegenheid

Press release
Het aanbod van woningen en de regionale groei van bevolking en werkgelegenheid hangen sterk met elkaar samen. Maar welke van deze grootheden is sturend, en welke is volgend? In Nederland blijkt woningbouw de groei van de regionale bevolking en werkgelegenheid maar in beperkte mate te volgen.

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We analyse the relationships between housing supply, regional population and employment empirically in a three-equation dynamic model. Annual regional panel data are used for the Netherlands, where a strong tradition of spatial planning exists.

We find that net internal migration is strongly determined by housing supply, whereas employment growth has no statistically significant impact. Growth of the housing stock is only moderately affected by population and employment, possibly as a result of restrictive spatial policies. Employment adjusts substantially towards a long-run relationship with the regional population. The analysis further indicates that labour markets drive this long-run adjustment more than local consumer demand. Hence, people follow houses rather than jobs, and jobs follow people in the long run.


Wouter Vermeulen
J. van Ommeren

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