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Living on a Noisy and Dusty Street: Implications for Environmental Evaluation

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Author Info
Tagreed Boules
Robert Gagné ()
Paul Lanoie ()

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Abstract

This paper contributes to the literature on the hedonic pricing method in three different ways: i) the experimental context is new and typical of many urban settings, i.e. comparison between the price of houses located on a noisy and dusty street and that of houses located on a quiet and clean street in the same neighborhood; ii) this experimental context allows us, in a sense, to combine for the first time two popular valuation methods (standard hedonic pricing and repeat-sale analysis); and iii) in contrast with previous studies that focused on one aspect of environmental quality, we investigate the impact of two environmental attributes on houses' price, namely noise and air pollution (dust), which have been measured specifically for this study. Our results show that neither of these environmental attributes has an impact on the houses' price.

Cette étude propose trois contributions à la littérature s'intéressant à la méthode des prix hédoniques: i) le contexte expérimental est différent des études antérieures puisqu'il utilise un échantillon de transactions sur des propriétés résidentielles d'un même quartier, certaines localisées sur une rue poussiéreuse et bruyante et d'autres sur des rues calmes et propres; ii) ce contexte expérimental permet pour la première fois de combiner deux approches (la méthode des prix hédoniques et l'analyse des ventes répétées); et iii) contrairement aux études précédentes qui ne s'intéressaient qu'à un aspect environnemental, nous considérons l'impact de deux aspects environnementaux, le bruit et la qualité de l'air, ces deux aspects ayant été l'objet de mesures spécifiques pour cette étude. Nos résultats montrent qu'aucun des deux aspects de la qualité de l'environnement n'a d'effet sur le prix des propriétés résidentielles.

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Paper provided by CIRANO in its series CIRANO Working Papers with number 97s-08.

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Date of creation: 01 Feb 1997
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Handle: RePEc:cir:cirwor:97s-08

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Keywords: Housing market; Hedonic pricing; Environment; Environmental evaluation; Marché immobilier; prix nédoniques; environnement; évaluation;

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  1. Mendelsohn, Robert & Hellerstein, Daniel & Huguenin, Michael & Unsworth, Robert & Brazee, Richard, 1992. "Measuring hazardous waste damages with panel models," Journal of Environmental Economics and Management, Elsevier, vol. 22(3), pages 259-271, May. [Downloadable!] (restricted)
  2. Palmquist, Raymond B., 1982. "Measuring environmental effects on property values without hedonic regressions," Journal of Urban Economics, Elsevier, vol. 11(3), pages 333-347, May. [Downloadable!] (restricted)
  3. White, Halbert, 1980. "A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity," Econometrica, Econometric Society, vol. 48(4), pages 817-38, May. [Downloadable!] (restricted)
  4. O'Byrne, Patricia Habuda & Nelson, Jon P. & Seneca, Joseph J., 1985. "Housing values, census estimates, disequilibrium, and the environmental cost of airport noise: A case study of Atlanta," Journal of Environmental Economics and Management, Elsevier, vol. 12(2), pages 169-178, June. [Downloadable!] (restricted)
  5. Rasmussen, David W & Zuehlke, Thomas W, 1990. "On the Choice of Functional Form for Hedonic Price Functions," Applied Economics, Taylor and Francis Journals, vol. 22(4), pages 431-38, April.
  6. Grossman, Gene M & Krueger, Alan B, 1995. "Economic Growth and the Environment," The Quarterly Journal of Economics, MIT Press, vol. 110(2), pages 353-77, May. [Downloadable!] (restricted)
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