Amazon is poised to drop a “prosperity bomb” on whichever city it chooses to build a $5 billion, 50,000-person second headquarters, according to a new study from the Washington, D.C.-based think tank the Brookings Institution.

The company has spent the last year running a sort of public contest for its Amazon HQ2 selection with various city governments racing to fulfill Amazon’s most desired urban features and requirements.

The question, writes the Brookings Institution’s Joseph Parilla, is will new wealth be shared equitably or accrue mostly to a relatively small group?

One of the biggest factors that will decide the answer is how the chosen city will respond to Amazon’s impact on housing affordability.

Amazon estimates it’s generated $38 billion in economic activity in Seattle between 2010 and 2016, as local unemployment fell to a very low level. And yet, the company’s impact has arguably left some vulnerable residents worse off.

That’s in large part because the cost of housing has outpaced wage gains. While the income of families at the 20th percentile of the earnings distribution grew by 14 percent between 2014 and 2016, rents increased at 19 percent, according to Zillow.

“When housing supply was constrained, as has occurred in Seattle, the cost of living increases experienced by the working class outstripped any wage gains,” Parilla wrote.

So a key task for the city that wins Amazon’s headquarters is ensuring that its arrival does not rapidly drive up housing costs.

That should include not only stimulating new market-rate development through zoning, but also setting aside some of the tax revenue generated by Amazon to fund and preserve affordable housing, Parilla advised.

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