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Willingness to pay for clean air: Evidence from diesel vehicle registration restrictions in Japan

Author

Listed:
  • Shuhei Nishitateno

    (School of Policy Studies, Kwansei Gakuin University)

  • Paul J. Burke

    (Crawford School of Public Policy, Australian National University)

Abstract

This paper documents the effect of diesel vehicle registration restrictions introduced in Japan in 2001 in reducing suspended particulate matter (SPM) concentrations. The focus is on Aichi and Mie prefectures, home to a number of municipalities that were required to implement these restrictions in 2001. The paper then uses this intervention to estimate the causal effect of air pollution on land values. We obtain estimates of the elasticity of residential land prices with respect to SPM concentration of between 0.4 and 1.0. The revealed willingness to pay for the improvements in air quality induced by the intervention in Aichi and Mie is estimated at about US$7 billion. We also find evidence that net in-migration appears to be a key mechanism via which clean air was capitalized into higher land values. The results are robust to a number of estimation approaches and sample restrictions.

Suggested Citation

  • Shuhei Nishitateno & Paul J. Burke, 2021. "Willingness to pay for clean air: Evidence from diesel vehicle registration restrictions in Japan," CCEP Working Papers 2101, Centre for Climate & Energy Policy, Crawford School of Public Policy, The Australian National University.
    • Handle: RePEc:een:ccepwp:2101
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    File URL: https://openresearch-repository.anu.edu.au/bitstreams/58ce6feb-7dea-4193-8149-f0c619ce35bd/download
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    Cited by:

    1. Edoh Y. Amiran & Joni S. James Charles, 2021. "Reconciling revealed and stated measures for willingness to pay in recreation by building a probability model," Papers 2107.14343, arXiv.org.
    2. Zhu, Tianyun, 2025. "Estimating the implicit price elasticity of the demand for air quality: A hedonic approach," Journal of Housing Economics, Elsevier, vol. 67(C).
    3. Chao Zhang & Mimi Xiong & Xuehui Wei & Zongmin Lan, 2023. "Spatial heterogeneity of marginal willingness to pay for air quality in PM2.5: analysis of buyers’ housing price in Beijing through hedonic price, spatial regression, and quantile regression models," Asia-Pacific Journal of Regional Science, Springer, vol. 7(3), pages 697-720, September.
    4. Changyi Liang & Jing Zhao & Weibiao Ma, 2024. "Urban Spatial Development Mode and Haze Pollution in China: From the Perspective of Polycentricity," Sustainability, MDPI, vol. 16(18), pages 1-17, September.
    5. Shuhei Nishitateno & Paul J. Burke, 2024. "Effects of Low Emission Zones on Air Quality, New Vehicle Registrations, and Birthweights: Evidence from Japan," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 87(7), pages 1955-1992, July.
    6. Kang, Cheolmin & Ota, Mitsuru & Ushijima, Koichi, 2024. "Benefits of diesel emission regulations: Evidence from the World's largest low emission zone," Journal of Environmental Economics and Management, Elsevier, vol. 125(C).
    7. Shuhei NISHITATENO, 2025. "Hydrogen Infrastructure, Fuel Cell Electric Vehicles, and Indirect Network Effects: Evidence from Japan," Discussion papers 25045, Research Institute of Economy, Trade and Industry (RIETI).
    8. Shuhei Nishitateno & Paul J. Burke & Toshi H. Arimura, 2024. "Road traffic flow and air pollution concentrations: evidence from Japan," International Journal of Economic Policy Studies, Springer, vol. 18(2), pages 357-385, August.

    More about this item

    JEL classification:

    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
    • R48 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government Pricing and Policy

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