This dissertation consists of three essays in urban economics, employing empirical econometric methods in each. The first and third essays utilize micro-level housing transaction data, while the second relies on registry data. Essays one and two evaluate a policy decision with difference-in-differences as the primary identification strategy, whereas a Bartik instrumental approach is applied in the third. All the essays consider the impact on the local construction industry.

The dissertation commences with an exploration of the impact of a new light rail transit line on the housing market in the Helsinki region. A notable increase in dwelling prices within 800 meters of the stops becomes evident more than five years before the planned commencement of operations. The anticipated benefits of the investment are projected to outweigh its costs.

The second essay assesses the influence of municipal mergers on local land use. The findings indicate that, on aggregate, mergers do not have a notable effect on sprawl as there is no significant change in the location of new housing units, at least concerning their proximity to the center of the post-merger municipality in the short term.

The dissertation concludes by investigating how the construction sector responds to fluctuations in the local business cycle. A reduction in construction activity during a building’s development contributes to a lasting decline in structural quality. Buildings constructed during a downturn exhibit significantly higher future operating costs and an increased need for renovations. This dissertation consists of three essays in urban economics, employing empirical econometric methods in each. The first and third essays utilize micro-level housing transaction data, while the second relies on registry data. Essays one and two evaluate a policy decision with difference-in-differences as the primary identification strategy, whereas a Bartik instrumental approach is applied in the third. All the essays consider the impact on the local construction industry.

The dissertation commences with an exploration of the impact of a new light rail transit line on the housing market in the Helsinki region. A notable increase in dwelling prices within 800 meters of the stops becomes evident more than five years before the planned commencement of operations. The anticipated benefits of the investment are projected to outweigh its costs.

The second essay assesses the influence of municipal mergers on local land use. The findings indicate that, on aggregate, mergers do not have a notable effect on sprawl as there is no significant change in the location of new housing units, at least concerning their proximity to the center of the post-merger municipality in the short term.

The dissertation concludes by investigating how the construction sector responds to fluctuations in the local business cycle. A reduction in construction activity during a building’s development contributes to a lasting decline in structural quality. Buildings constructed during a downturn exhibit significantly higher future operating costs and an increased need for renovations.