The value of the greenbelt in Vienna: a spatial hedonic analysis
AbstractThis paper employs the hedonic price method (HPM) to examine whether the implicit value of the greenbelt is capitalized into apartment prices in the city of Vienna, Austria. We improve the traditional model using spatial econometric techniques and compare estimates from different spatial models, namely the spatial lag model (SAR), the spatial error model (SEM) and the spatial Durbin model (SDM). While our use of spatial models addresses the common problem of omitted variable bias, the SDM specifically allows for controlling possible nearby proximity effects (i.e., small-scale neighbourhood) that are rarely included in this type of analyses. Findings indicate that distance from the greenbelt is important in explaining apartment prices in Vienna: while the CBD exerts a centripetal force, the greenbelt, on the contrary, exerts a centrifugal force. The SDM is found to be the best performing model indicating existence of small-scale neighbourhood effects and presenting a solid case for consideration of this model in valuation of green amenities.
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Date of creation: 30 Jan 2014
Date of revision:
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Greenbelt; open space; urban amenities; hedonic price valuation; Spatial econometrics; spatial Durbin model;
Other versions of this item:
- Johanna CHOUMERT & Gunther MAIER & Shanaka HERATH, 2014. "The value of the greenbelt in Vienna: a spatial hedonic analysis," Working Papers 201402, CERDI.
- R21 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Housing Demand
- Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
- C31 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models; Quantile Regressions; Social Interaction Models
This paper has been announced in the following NEP Reports:
- NEP-ALL-2014-02-08 (All new papers)
- NEP-ENV-2014-02-08 (Environmental Economics)
- NEP-GEO-2014-02-08 (Economic Geography)
- NEP-URE-2014-02-08 (Urban & Real Estate Economics)
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