@article{c9a950779368431ba3a5fad6aa02d84b,
title = "How does a development moratorium affect development timing choices and land values?",
abstract = "This paper investigates how a development moratorium affects choices of development timing and land values in a framework where both the value of developed property evolves stochastically and the development costs are fully irreversible. We assume that a regulator initially announces that land is not allowed to be developed during a finite period of time in the future. A developer, thus, must decide whether to develop land before the timing ordinance is imposed, or after it expires. The development moratorium reduces the developer's option value from waiting and, thus, accelerates development. We also use simulation analysis to demonstrate how the other factors that relate to the demand and supply conditions of the real estate market affect this accelerating effect.",
keywords = "American options, Development moratoria, Growth controls, Real options",
author = "Jou, {Jyh Bang} and Lee, {Tan (Charlene)}",
note = "Funding Information: Acknowledgements We would like to thank the guest editors (Richard Buttimer and Kanak Patel), one anonymous reviewer, Dean A. Paxson, Matthieu Dulguerov, Pai-Ta Shih, and participants at the 2008 Amsterdam Cambridge-UNCC Symposium, the 2008 NTU International Conference on Finance, and the seminar at Massy University for their helpful comments on earlier versions of this manuscript. We also thank Hsien-Jung (Gary) Chung for research assistance. Financial support under Grant NSC 97-2410-H-155-009 from the National Science Council, Executive Yuan, R.O.C., is gratefully acknowledged.",
year = "2009",
doi = "10.1007/s11146-009-9184-0",
language = "???core.languages.en_GB???",
volume = "39",
pages = "301--315",
journal = "Journal of Real Estate Finance and Economics",
issn = "0895-5638",
number = "3",
}