How Self-Interest and Symbolic Politics Shape the Effectiveness of Compensation for Nearby Housing Development

Policy with concentrated costs often faces intense localized opposition. Both private and governmental actors frequently use ?nancial compensation to attempt to overcome this opposition. Using the policy of new housing production, we measure the e?ectiveness of ?nancial compensation in winning policy support. We build a novel survey that shows respondents images of their self-reported neighborhood with hypothetical renderings of new housing development superimposed on existing structures. Using a sample of nearly 600 Bostonians, we ?nd that compensating nearby residents increases their support for nearby market-rate housing construction. However, compensation does not in?uence support for a?ordable housing, suggesting limits to the role of self-interest in evaluating concentrated costs.