The Effect of the Theo Van Gogh Murder on House Prices in Amsterdam

45 Pages Posted: 20 May 2008

See all articles by Pieter A. Gautier

Pieter A. Gautier

Free University of Amsterdam; Tinbergen Institute Amsterdam (TIA); IZA Institute of Labor Economics

Arjen Siegmann

VU University Amsterdam

Aico van Vuuren

Erasmus University Rotterdam (EUR) - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: March 2007

Abstract

Does Islamic terrorism have an effect on the general attitudes towards Muslim minorities? We use the murder of Theo van Gogh as an event study to address this question. Specifically, we use the hedonic-market model and test for an effect on listed house prices in neighbourhoods where more than 25% of the people belong to an ethnic minority from a Muslim country (type I). Relative to the other neighbourhoods, house prices in type I neighbourhoods decreased in 10 months by about 3%, with a widening gap over time. We use a unique weekly data set from a multi listing service that contains over 70% of all houses for sale and obtain the actual transaction prices from the registers office. Our results are robust to several adjustments including changes in the control group. There is no significant difference in the time it takes for houses to be sold in type I versus other neighbourhoods. Finally, we find evidence that segregation increased. People belonging to the Muslim minority were more likely to buy and less likely to sell a house in a type I neighbourhood after the murder than before.

Keywords: Hedonic market method, differences in differences, economics of terror, housing market

JEL Classification: C21, C41, C81, R31

Suggested Citation

Gautier, Pieter A. and Siegmann, Arjen and van Vuuren, Aico, The Effect of the Theo Van Gogh Murder on House Prices in Amsterdam (March 2007). , Vol. , pp. -, 2007. Available at SSRN: https://ssrn.com/abstract=1133819

Pieter A. Gautier (Contact Author)

Free University of Amsterdam ( email )

Amsterdam, ND North Holland
Netherlands

Tinbergen Institute Amsterdam (TIA) ( email )

Gustav Mahlerplein 117
Amsterdam, 1082 MS
Netherlands

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Arjen Siegmann

VU University Amsterdam ( email )

De Boelelaan 1105
Dept. of Finance
Amsterdam, NOT IN US OR CANADA 1081 HV
Netherlands
+31205986581 (Phone)

HOME PAGE: http://personal.vu.nl/a.h.siegmann

Aico Van Vuuren

Erasmus University Rotterdam (EUR) - Department of Economics ( email )

P.O. Box 1738
3000 DR Rotterdam
Netherlands
+31 10 4082158 (Phone)
+31 10 4089149 (Fax)

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