Sorting based on urban heritage and income: Evidence from the Amsterdam metropolitan area

We study the relationship between cultural heritage and city structure in a residential sorting model. Contrary to previous research, we find that all income groups attach a large value to the proximity of urban heritage while there are important differences associated with other household characteristics. In line with previous research, we find that all households attach value to the share of high-income households in neighborhoods. Our approach covers both elements and we use the estimated version to investigate the overall impact of cultural heritage on within-city structure. We simulate the housing market equilibrium in a counterfactual situation without spatial differences in the presence of cultural heritage. The results suggest that without highly valued inner city amenities, households’ location choice in European cities, such as Amsterdam, would be much more similar to US cities.