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The Impact of Housing Market Segmentation between Tourists and Residents on the Hedonic Price for Landscape Quality

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  • Nils Soguel
  • Marc-Jean Martin
  • Alexandre Tangerini

Abstract

Market segmentation is an important issue when estimating the implicit price for an environmental amenity from a surrogate market like property. This paper tests the hypothesis of a segmentation of the housing market between tourists and residents and computes the implicit price for natural landscape quality in Swiss alpine resorts. The results show a clear segmentation between both groups of consumers, although tests also show that the estimated coefficient for landscape is similar in the tourists’ model and in the residents’. However, since the functional form is non linear, the nominal – rather than relative - value of a change in natural landscape quality is higher in the tourist housing market than in the residents’. Hence, considering the segmentation of the market between tourists and residents is essential in order to provide valid estimates of the nominal implicit price of natural landscape quality.

Suggested Citation

  • Nils Soguel & Marc-Jean Martin & Alexandre Tangerini, 2008. "The Impact of Housing Market Segmentation between Tourists and Residents on the Hedonic Price for Landscape Quality," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 144(IV), pages 655-678, December.
    • Handle: RePEc:ses:arsjes:2008-iv-6
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    Cited by:

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    3. Halkos, George & Matsiori, Steriani, 2014. "Exploring social attitude and willingness to pay for water resources conservation," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 49(C), pages 54-62.
    4. Halkos, George, 2012. "Assessing the economic value of protecting artificial lakes," MPRA Paper 39557, University Library of Munich, Germany.

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    More about this item

    Keywords

    Hedonic prices method; Market segmentation; Landscape quality; Landscape value; MACBETH;
    All these keywords.

    JEL classification:

    • D49 - Microeconomics - - Market Structure, Pricing, and Design - - - Other
    • Q26 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Recreational Aspects of Natural Resources
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects

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