The Amenity Value of Climate Change Across Different Regions in the United States

This article estimates the amenity value from climate change by analyzing the effect of climatic variables on house prices near ski resorts in different regions in the United States using a hedonic model. We find that higher average winter temperatures tend to increase house price near ski resorts at a decreasing rate. Using the implicit value of average winter temperature, we estimate its demand and find that the crossing point temperature, where the homeowner’s consumer surplus from average winter temperature moves from positive to negative, varies in each region. The highest crossing point temperature is in the Western region at 46°F and lowest is in the Midwest at 8°F. Based on projections in the next 30 years, we find that the consumer surplus from average winter temperature for the median home owner is negative in the Midwest and Northeastern regions where the crossing point temperatures are lowest and it is positive for the West and Mountain regions where the crossing point temperatures are highest. The long run effect of climate change on homeowner’s consumer surplus is negative for all regions.