Limited Growth: 500 Years of Urban Rents
77 Pages Posted: 12 Jul 2019 Last revised: 8 May 2023
Date Written: May 8, 2023
Abstract
This paper explores half a millennium of rent growth in seven European cities (1500– 2020). Based on extensive data collection of rental cash flows, we construct continuous annual rent indices. Long-term real rent growth has been limited, but sluggish supply adjustments lead to past population growth negatively predicting current rental growth. We highlight rents as a significant yet underappreciated component of historic urban household budgets. Factoring rents into inflation measures substantially lowers urban standard-of-living growth estimates. At the city level, we propose that rent growth may serve as a more accurate indicator of historic economic growth than day wages.
Keywords: rents, economic growth, standard of living, urban history
JEL Classification: R30, N93, N94
Suggested Citation: Suggested Citation