In my childhood, the concept of “endangered species” evoked beautiful, threatened creatures in desperate need of saving — your pandas, whales or all-American bald eagles.
Today, it’s become synonymous with development projects held up over some obscure frog no one cares about.
In one particularly hilarious reversal of fortune for the environmental movement, scientists recently discovered that the snail darter, a small fish that controversially delayed a major dam project in the 1970s, isn’t even a unique species.
Now we’re learning that the ever-expanding list of species that America considers endangered has helped drive the bedeviling problem of affordable housing.
In a new paper for the Journal of Public Economics, economist Maxwell Tabarrok traces how the federal Endangered Species Act, passed in 1973, affects housing permits.
He found a substantial impact: “Species listings reduce annual permit flows by . . . about 10% of the average annual flow.”
That’s somewhere around 9 million housing permits affected in total since 1980 — most of which appear to have been lost, not merely moved elsewhere, in Tabarrok’s estimation.
In other words, the ESA is one factor constraining housing supply — having cost us perhaps 4% of the total stock at this point — and driving up prices.
The act, Tabarrok explains, makes it illegal to “harm” or “harass” a listed animal.
This can include not just paving over its territory, but even light pollution and stormwater runoff.
When a species is listed, building projects in areas where it lives can require modifications, be called off entirely, or never get off the ground to begin with.
To quantify the effect on building permits, Tabarrok combined permit data from a census survey with data on species listings and habitats — a large undertaking that involved matching different types of geography and jurisdictions.
In 1970 there were only 82 endangered species; two decades later the number was getting close to 500.
Last year it reached nearly 1,500.
Endangered-species habitats now cover most of the United States, often overlapping with each other, and they especially blanket California and Florida.
That might be bad news for development, but it also facilitates the use of modern statistical methods.
Each time a new species listing affects some parts of the country but not others, it creates a sort of natural experiment — did permitting trends suddenly change in the affected places relative to others?
Focusing on the 1980-2024 period, Tabarrok implemented this basic concept in a few different ways, with similar conclusions.
His various approaches make different technical tradeoffs and vary in how they try to address the study’s biggest limitation — namely, that endangered-species listings might not be a random shock to development that can be analyzed as an experiment.
For example, previous development might have caused a species to become endangered, or it could have prompted lobbyists to push for or against new listings (though this decision isn’t supposed to involve consideration of economic impacts).
It’s also possible that places that are home to endangered species might simply be different, in important ways, from places that don’t.
Tabarrok also dug into a few smaller questions: For example, he found no effect from species listings that are merely proposed and not yet enforced — and a reversal of the effect when a species is de-listed.
And when he added satellite data on land use to his dataset, he found similar impacts on “greenfield” projects proposed to be built on undeveloped land and on “infill” projects, new construction in already-developed areas.
That’s significant, because an “infill” project will generally mean less change to the overall habitat — suggesting that the letter of the law, not the real-world impact on endangered species, is the constraining factor.
There is, of course, a real tradeoff between building enough housing where people need it and protecting species we’re in danger of losing.
But with endangered-species habitats blanketing the country and millions of housing projects lost, perhaps we’ve let environmentalists win some battles they should not have.
Robert VerBruggen is a senior fellow at the Manhattan Institute. Adapted from City Journal on Substack.
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