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Do Conservation Easements Reduce Land Prices? The Case of South Central Wisconsin

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Author Info
Kathryn Anderson (UNDP)
Diana Weinhold (London School of Economics)

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Abstract

While theory strongly suggests that restricting development rights should reduce land prices, empirical evidence of this effect has been notoriously hard to obtain. Indeed, largely based on this difficulty a Congressional committee has recently recommended that tax benefits for such restrictions be severely curtailed. We collect data on 131 land transactions in South Central Wisconsin, including 19 cases of development-restricted parcels. When we use the whole sample to estimate the impact of conservation easements we replicate the results of Nickerson and Lynch (2001), finding a negative but statistically insignificant effect. However we then show that when the sample is appropriately restricted to a more homogenous group of land parcels, our ability to detect an effect increases dramatically. In particular, for vacant agricultural land we find a statistically significant negative impact of conservation easements that ranges up to 50% of land values

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File URL: http://129.3.20.41/eps/urb/papers/0506/0506001.pdf
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Publisher Info
Paper provided by EconWPA in its series Urban/Regional with number 0506001.

Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Length: 26 pages
Date of creation: 03 Jun 2005
Date of revision:
Handle: RePEc:wpa:wuwpur:0506001

Note: Type of Document - pdf; pages: 26. In this paper we use hedonic land price models to estimate the value of development rights.
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Web page: http://129.3.20.41

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Related research
Keywords: land use; valuation of development rights; conservation easements; hedonic regression;

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Find related papers by JEL classification:
Q24 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Land
R52 - Urban, Rural, and Regional Economics - - Regional Government Analysis - - - Land Use and Other Regulations

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Boyd, James & Simpson, R. David & Caballero, Kathryn, 1999. "The Law and Economics of Habitat Conservation: Lessons from an Analysis of Easement Acquisitions," Discussion Papers dp-99-32, Resources For the Future. [Downloadable!]
  2. Bergstrom, John C. & Dillman, B.L. & Stoll, John R., 1985. "Public Environmental Amenity Benefits Of Private Land: The Case Of Prime Agricultural Land," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 17(01), July. [Downloadable!]
  3. Plantinga, Andrew J. & Lubowski, Ruben N. & Stavins, Robert N., 2002. "The effects of potential land development on agricultural land prices," Journal of Urban Economics, Elsevier, vol. 52(3), pages 561-581, November. [Downloadable!] (restricted)
    Other versions:
  4. Andrew J. Plantinga & Douglas J. Miller, 2001. "Agricultural Land Values and the Value of Rights to Future Land Development," Land Economics, University of Wisconsin Press, vol. 77(1), pages 56-67. [Downloadable!] (restricted)
  5. Lynch, Lori & Musser, Wesley N., 1999. "A Relative Efficiency Analysis Of Farmland Preservation Programs," 1999 Annual meeting, August 8-11, Nashville, TN 21639, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association). [Downloadable!]
    Other versions:
  6. Christopher M. Anderson & Jonathan R. King, 2004. "Equilibrium Behavior in the Conservation Easement Game," Land Economics, University of Wisconsin Press, vol. 80(3), pages 355-374. [Downloadable!] (restricted)
  7. W. Patrick Beaton, 1991. "The Impact of Regional Land-Use Controls on Property Values: The Case of the New Jersey Pinelands," Land Economics, University of Wisconsin Press, vol. 67(2), pages 172-194. [Downloadable!] (restricted)
  8. David M. Henneberry & Richard L. Barrows, 1990. "Capitalization of Exclusive Agricultural Zoning into Farmland Prices," Land Economics, University of Wisconsin Press, vol. 66(3), pages 249-258. [Downloadable!] (restricted)
  9. Heimlich, Ralph E. & Anderson, William D., 2001. "Development At The Urban Fringe And Beyond: Impacts On Agriculture And Rural Land," Agricultural Economics Reports 33943, United States Department of Agriculture, Economic Research Service. [Downloadable!]
  10. Irwin, Elena G & Bockstael, Nancy E, 2001. " The Problem of Identifying Land Use Spillovers: Measuring the Effects of Open Space on Residential Property Values," American Journal of Agricultural Economics, American Agricultural Economics Association, vol. 83(3), pages 698-704, August. [Downloadable!] (restricted)
  11. Nickerson, Cynthia J & Lynch, Lori, 2001. " The Effect of Farmland Preservation Programs on Farmland Prices," American Journal of Agricultural Economics, American Agricultural Economics Association, vol. 83(2), pages 341-51, May. [Downloadable!] (restricted)
  12. Bucholtz, Shawn & Geoghegan, Jacqueline & Lynch, Lori, 2003. "Capitalization of Open Spaces into Housing Values and the Residential Property Tax Revenue Impacts of Agricultural Easement Programs," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 32(1), April. [Downloadable!]
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Lynch, Lori & Gray, Wayne & Geoghegan, Jacqueline, 2007. "An Evaluation of Working Land and Open Space Preservation Programs in Maryland: Are They Paying Too Much?," Working Papers 6887, University of Maryland, Department of Agricultural and Resource Economics. [Downloadable!]
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