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The Impact of Carcinogenic Risk Exposure on Housing Values: Estimates from Chemical Reclassifications

Author

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  • van Binsbergen, Jules
  • Cocco, João F.
  • Grotteria, Marco
  • Naaraayanan, Lakshmi

Abstract

We quantify the impact of perceived cancer risk on housing values using widely advertised national reclassifications of chemical carcinogenicity in the United States. Combining these information events with an empirical design that compares changes in house values closer to affected toxic plants against those farther away isolates the effect of cancer risk news from other local factors. Focusing on plants previously emitting reclassified carcinogenic chemicals, we estimate a 1-2% decline in housing values within a 3-mile radius compared to those located farther away. The effects are stronger in areas with higher media presence underscoring the role of salience as a mechanism.

Suggested Citation

  • van Binsbergen, Jules & Cocco, João F. & Grotteria, Marco & Naaraayanan, Lakshmi, 2025. "The Impact of Carcinogenic Risk Exposure on Housing Values: Estimates from Chemical Reclassifications," CEPR Discussion Papers 20512, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:20512
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    JEL classification:

    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • G50 - Financial Economics - - Household Finance - - - General
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects

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