Floodplain Conservation as a Flood Mitigation Strategy: Examining Costs and Benefits
AbstractThere has been growing interest among local governments in floodplain conservation as a flood damage reduction strategy. We evaluate one such investment—a greenway along the Meramec River in St. Louis County, Missouri. We estimate the opportunity costs of the conservation investment less the avoided flood damages from retaining the land as open space. To estimate avoided flood damages, we undertake a parcel-level analysis using the Hazus flood model, a GIS-based model developed for FEMA that includes a hydrology and hydraulics model coupled with a damage model relating flood depths to property damage. We examine the distribution of damages across parcels, demonstrating that careful spatial targeting can increase the net benefits of conservation. Finally, because creation of the greenway was motivated by the range of benefits it would provide, including aesthetic and recreational benefits, we undertake a hedonic model to estimate the capitalization of proximity to the greenway in property values. We find that the benefits of increased property values are roughly equal to the avoided flood damages, and that taken together, the floodplain conservation has generated net benefits.
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Bibliographic InfoPaper provided by Resources For the Future in its series Discussion Papers with number dp-13-22.
Date of creation: 25 Jul 2013
Date of revision:
floodplain conservation; benefit–cost analysis; hedonic model; hazus; floods;
Find related papers by JEL classification:
- Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
- Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters
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- Kuminoff, Nicolai V. & Parmeter, Christopher F. & Pope, Jaren C., 2010. "Which hedonic models can we trust to recover the marginal willingness to pay for environmental amenities?," Journal of Environmental Economics and Management, Elsevier, vol. 60(3), pages 145-160, November.
- Boyd, James & Epanchin-Niell, Rebecca & Siikamaki, Juha, 2012. "Conservation Return on Investment Analysis: A Review of Results, Methods, and New Directions," Discussion Papers dp-12-01, Resources For the Future.
- Okmyung Bin & Jamie Brown Kruse & Craig E. Landry, 2008. "Flood Hazards, Insurance Rates, and Amenities: Evidence From the Coastal Housing Market," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 75(1), pages 63-82.
- Leggett, Christopher G. & Bockstael, Nancy E., 2000. "Evidence of the Effects of Water Quality on Residential Land Prices," Journal of Environmental Economics and Management, Elsevier, vol. 39(2), pages 121-144, March.
- Carolyn Kousky, 2010. "Learning from Extreme Events: Risk Perceptions after the Flood," Land Economics, University of Wisconsin Press, vol. 86(3).
- Okmyung Bin & Craig E. Landry & Gregory F. Meyer, 2009. "Riparian Buffers and Hedonic Prices: A Quasi-Experimental Analysis of Residential Property Values in the Neuse River Basin," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 91(4), pages 1067-1079.
- Jared Carbone & Daniel Hallstrom & V. Smith, 2006. "Can Natural Experiments Measure Behavioral Responses to Environmental Risks?," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 33(3), pages 273-297, 03.
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