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Endogenous Spatial Externalities: Empirical Evidence and Implications for the Evolution of Exurban Residential Land Use Patterns

In: Advances in Spatial Econometrics

Author

Listed:
  • Elena Irwin

    (The Ohio State University)

  • Nancy Bockstael

    (University of Maryland)

Abstract

The notion that “neighbors” may generate spatial externalities is well established in economics. In addition to textbook examples of externalities among firms, a significant body of empirical work in urban and environmental economics has provided evidence of the effects of neighboring, undesirable land uses on residential location decisions and housing values. The goal of this chapter is not to challenge or augment this literature, but rather to use it as a starting point in asking whether spatial externalities may influence actual land use conversion decisions by landowning agents. The basic thesis proposed here is that agents’ consideration of these spatial externalities may influence their land use decisions if the resulting change in a parcel’s relative values in alternative land uses is sufficiently strong. If so, then the presence of such spatial externalities creates an interdependence among neighboring agents’ land use decisions, which implies that land use conversion may be partially driven by a process of endogenous change.

Suggested Citation

  • Elena Irwin & Nancy Bockstael, 2004. "Endogenous Spatial Externalities: Empirical Evidence and Implications for the Evolution of Exurban Residential Land Use Patterns," Advances in Spatial Science, in: Luc Anselin & Raymond J. G. M. Florax & Sergio J. Rey (ed.), Advances in Spatial Econometrics, chapter 17, pages 359-380, Springer.
    • Handle: RePEc:spr:adspcp:978-3-662-05617-2_17
    DOI: 10.1007/978-3-662-05617-2_17
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    Citations

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    Cited by:

    1. Don J. Webber & Stephanié Rossouw, 2010. "Sub-national vulnerability measures:A spatial perspective," Working Papers 1004, Department of Accounting, Economics and Finance, Bristol Business School, University of the West of England, Bristol.
    2. Linda Steinhübel & Johannes Wegmann & Oliver Mußhoff, 2020. "Digging deep and running dry—the adoption of borewell technology in the face of climate change and urbanization," Agricultural Economics, International Association of Agricultural Economists, vol. 51(5), pages 685-706, September.
    3. Stephanié Rossouw & Don J. Webber, 2012. "Sub-national vulnerability and relative location: A case study of South Africa," Working Papers 2012-01, Auckland University of Technology, Department of Economics.
    4. Paul Voss & David Long & Roger Hammer & Samantha Friedman, 2006. "County child poverty rates in the US: a spatial regression approach," Population Research and Policy Review, Springer;Southern Demographic Association (SDA), vol. 25(4), pages 369-391, August.

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