Why is Housing Unaffordable? The Great Migration’s Effect on Exclusionary Zoning

Published: 2020 | Alexander Sahn

Abstract

High housing prices drive inequality, reduce growth, and increase racial segregation. Scholars have identified laws restricting the use of land, particularly for dense multi-family housing, as a primary cause of housing unaffordability. What explains the prevalence of these laws in municipal governments across the United States? I argue that in response to the Great Migration of African-Americans to non-Southern cities, municipal governments enacted more exclusionary zoning policies to exclude the poor in response to white residents preferences. Using original data on municipal zoning laws and leveraging exogenous factors for Black migration from 1940 to 1970, I show that cities that receive more migration 1) have more exclusionary zoning today, 2) produce fewer new units of multi-family housing over decades, and 3) have less affordable housing. I provide evidence that conservative white racial attitudes are connected to the Great Migration and argue that preferences for racial segregation drive the adoption of exclusionary zoning. These findings explain the origins of a major institution of municipal government and the consequences of these policies for housing affordability today.