Abstract
The purpose of this paper is to consider the effect and rationality of historic preservation by transfer of development rights (TDR). First, we calculate the externalities of the five cases by a hedonic approach. As a result, it is shown that historic preservation by TDR has positive externalities in the neighborhood, while historic buildings or developments with eased Floor Area Ratio (FAR) themselves don't necessarily have significant effects. Second, we conduct qualitative analysis on these five cases, and find that there are such ripple effects as attracting more people, improving city landscape and creating character with historic ambience. As a conclusion, it is surely reasonable to realize historic preservation by TDR if they try to create these multiplied effects.
