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The Impact of Green Building Labels on the Price of Housing: Evidence from China

Author

Listed:
  • Fang Fang

    (School of Public Economics and Administration, Shanghai University of Finance and Economics, Shanghai 200433, China)

  • Xuesong Li

    (School of Economics, Shanghai University of Finance and Economics, Shanghai 200433, China)

  • Ximing Chen

    (School of Finance, Shanghai University of Finance and Economics, Shanghai 200433, China)

  • Yahong Zhou

    (School of Economics, Shanghai University of Finance and Economics, Shanghai 200433, China)

Abstract

This paper focuses on the willingness to pay for green housing in China. First, we introduce green building related labels in China and briefly discuss the consumers¡¯ incentives to buy this kind of building. Second, with the available transaction data in Shanghai, a hedonic regression model is applied to investigate whether or not a price premium in the residential market exists. Furthermore, we use the nonparametric matching model under a treatment framework to see the robustness of our results. The empirical result shows there exists a significant price premium in China. However, the premium does not increase with quality certification tiers. That may imply that homebuyers in China are not sensitive to the differences among green buildings although they are willing to pay a higher price for this newly emerging energy-saving building. And we also give the explanation why this has happened.

Suggested Citation

  • Fang Fang & Xuesong Li & Ximing Chen & Yahong Zhou, 2018. "The Impact of Green Building Labels on the Price of Housing: Evidence from China," Frontiers of Economics in China-Selected Publications from Chinese Universities, Higher Education Press, vol. 13(4), pages 635-654, December.
    • Handle: RePEc:fec:journl:v:13:y:2018:i:4:p:635-654
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    File URL: http://journal.hep.com.cn/fec/EN/10.3868/s060-007-018-0029-3
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    More about this item

    Keywords

    Green Building Evaluation Label (GBEL); hedonic model; treatment effect; matching model; house price;
    All these keywords.

    JEL classification:

    • Q2 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation
    • R2 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis
    • C5 - Mathematical and Quantitative Methods - - Econometric Modeling

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