RT Journal Article
SR Electronic
T1 What Do Property Values Really Tell Us? A Hedonic Study of Underground Storage Tanks
JF Land Economics
JO Land Econ
FD University of Wisconsin Press
SP 211
OP 226
DO 10.3368/le.89.2.211
VO 89
IS 2
A1 Guignet, Dennis
YR 2013
UL http://le.uwpress.org/content/89/2/211.abstract
AB Hedonic property value models are widely used but are susceptible to potentially invalid conjectures based on the assumed measure of environmental quality. This paper focuses on an application where this is of particular concern: leaking underground storage tanks. I estimate a hedonic model using quasi-experimental and spatial econometric techniques. Similar to previous studies, I examine how house prices vary with distance to the disamenity. This approach yields little evidence that prices are adversely impacted. However, to better measure risks I utilize home-specific data on groundwater well tests and correspondence from regulators, and find an 11% depreciation when households are well informed. (JEL Q51, Q53)