Does Air Quality Matter? Evidence from the Housing Market
TLDR
In this article, the authors exploit the structure of the Clean Air Act to provide new evidence on the capitalization of total suspended particulates (TSPs) air pollution into housing values, and find that the elasticity of housing values with respect to particulates concentrations ranges from 0.20 to 0.35.Abstract:
We exploit the structure of the Clean Air Act to provide new evidence on the capitalization of total suspended particulates (TSPs) air pollution into housing values. This legislation imposes strict regulations on polluters in “nonattainment” counties, which are defined by concentrations of TSPs that exceed a federally set ceiling. TSPs nonattainment status is associated with large reductions in TSPs pollution and increases in county-level housing prices. When nonattainment status is used as an instrumental variable for TSPs, we find that the elasticity of housing values with respect to particulates concentrations ranges from 0.20 to 0.35. These estimates of the average marginal willingness to pay for clean air are robust to quasi-experimental regression discontinuity and matching specification tests. Further, they are far less sensitive to model specification than cross-sectional and fixed-effects estimates, which occasionally have the “perverse” sign. We also find modest evidence that the marginal benefit of reductions of TSPs is lower in communities with relatively high pollution levels,read more
Citations
More filters
Journal ArticleDOI
Recent developments in the econometrics of program evaluation
TL;DR: In the last two decades, much research has been done on the econometric and statistical analysis of such causal effects as discussed by the authors, which has reached a level of maturity that makes it an important tool in many areas of empirical research in economics, including labor economics, public finance, development economics, industrial organization, and other areas in empirical microeconomics.
Journal ArticleDOI
Regression Discontinuity Designs: A Guide to Practice
Guido W. Imbens,Thomas Lemieux +1 more
TL;DR: In regression discontinuity (RD) as mentioned in this paper, assignment to a treatment is determined at least partly by the value of an observed covariate lying on either side of a fixed threshold.
Journal ArticleDOI
Optimal Bandwidth Choice for the Regression Discontinuity Estimator
TL;DR: In this article, the authors investigate the problem of optimal choice of the smoothing parameter (bandwidth) for the regression discontinuity estimator, and propose an optimal, data dependent, bandwidth choice rule.
Journal ArticleDOI
The Economic Impacts of Climate Change: Evidence from Agricultural Output and Random Fluctuations in Weather
TL;DR: In this article, the authors report the results of a study of the impact of climate change on the US agricultural sector using the same model used by Deschenes and Greenstone (2007).
Journal ArticleDOI
The Economic Impacts of Climate Change: Evidence from Agricultural Profits and Random Fluctuations in Weather
TL;DR: In this article, the authors measure the economic impact of climate change on US agricultural land by estimating the effect of the presumably random year-to-year variation in temperature and precipitation on agricultural profits.
References
More filters
Journal ArticleDOI
Hedonic Prices and Implicit Markets: Product Differentiation in Pure Competition
TL;DR: In this article, a theory of hedonic prices is formulated as a problem in the economics of spatial equilibrium in which the entire set of implicit prices guides both consumer and producer locational decisions in characteristics space.
Journal ArticleDOI
An Association between Air Pollution and Mortality in Six U.S. Cities
Douglas W. Dockery,C A Pope rd,X Xu,John D. Spengler,James H. Ware,Martha E. Fay,Benjamin G. Ferris,Frank E. Speizer +7 more
TL;DR: It is suggested that fine-particulate air pollution, or a more complex pollution mixture associated with fine particulate matter, contributes to excess mortality in certain U.S. cities.
Journal ArticleDOI
Wages, Rents, and the Quality of Life
TL;DR: In this paper, the role of wages and rents in allocating workers to locations with various quantities of amenities is discussed, and it is shown that if the amenity is also productive, then the sign of the wage gradient is unclear while the rent gradient is positive.
BookDOI
The Measurement of Environmental and Resource Values : Theory and Methods
TL;DR: The Measurement of Environmental and Resource Values as mentioned in this paper provides an introduction to the principal methods and techniques of resource and environmental valuation to professional economists and graduate students who are not directly engaged in the field.
Related Papers (5)
Can Markets Value Air Quality? A Meta-Analysis of Hedonic Property Value Models
V. Kerry Smith,Ju-Chin Huang +1 more