Does historic preservation affect firms' output? Evidence from the awarding of the Historic City title in China

Historic preservation policies have garnered increasing attention and recognition from countries worldwide. However, most studies have focused on local livelihoods and housing, with few examining the effects on firms' production activities. Exploiting the awarding of the Historic City title in China, this paper provides the first empirical evidence of historic preservation's impact on industrial firms' output. Receiving the Historic City title reduces local industrial firms' output by 6.1%. The main mechanisms are restrictions on land use and industrial development. Furthermore, the historic preservation policy has a negative macro effect at the city level. These findings contribute to a more comprehensive understanding of the effects of historic preservation policies.