Environmental Externalities And Housing Price In Madrid: An Application With Spatial Quantile Regression
Air pollution and urban noise are major concerns in big cities. This paper aims at evaluating how they impact transaction prices in downtown Madrid. For that purpose, we incorporate two subjective measures of air pollution and noise, joint with other variables available for individual characteristics, accessibility and socio-economic data, and we use spatial quantile models with a sample of 5,080 houses in downtown Madrid. Spatial quantile regressions are a good instrument to deal with common problems in hedonic models, such as non-linearity, non-normality due to asymmetries and outliers, heteroskedasticity and spatial autocorrelation. We find that noise and air-pollution have no clear significant effect except in the wealthier neighborhoods, where pollution is clearly a disamenity. Additionally, we find a counter-intuitive positive sign for the effect of noise only for the group of the most exclusive properties, possibly because of their owner high ‘sense of place’, joint to the existence of some other related positive associated externalities, such as upscale shops and historical or cultural areas.
Volume (Year): 21 (2012)
Issue (Month): 2 ()
|Contact details of provider:|| Postal: |
Web page: http://www.usc.es/econo/RGE/benvidag.htm
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:sdo:regaec:v:21:y:2012:i:2_12. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ana Iglesias Casal)
If references are entirely missing, you can add them using this form.