Hedonic valuation of odor nuisance using field measurements, a case study of an animal waste processing facility in Flanders
In this paper we estimate the external cost caused by odor from an animal waste processing facility in Flanders using new odor measures based on field measurements. We compare three different ways of incorporating odor nuisance indicators into the model: distance to the odor source, continuous odor measures, and a dummy variable approach comparable to the standard procedure in hedonic price analysis of noise pollution. We argue that the dummy variable approach is best suited to estimate the external costs and we test these specifications for a dataset of about 1400 observations of house sales transaction between 2004 and 2008. Results show that houses subject to moderate and severe odor nuisance sell at a discount of about 5% and 12% respectively compared to houses without odor nuisance. The overall capitalized external cost of the odor exposure for the area of the case study was estimated to range between 6 and 56 million euro, with a central estimate of about 31 million euro. This estimate proves to be very stable over different model specifications. Compared to 1991, the external cost has almost been cut by half as a result of odor emission reducing measures taken by the facility.
|Date of creation:||Nov 2011|
|Date of revision:|
|Contact details of provider:|| Web page: http://research.hubrussel.be|
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Halvorsen, Robert & Palmquist, Raymond, 1980. "The Interpretation of Dummy Variables in Semilogarithmic Equations," American Economic Review, American Economic Association, vol. 70(3), pages 474-75, June.
- Joseph A. Herriges & Silvia Secchik & JBruce A. Babcock, 2005.
"Living with Hogs in Iowa: The Impact of Livestock Facilities on Rural Residential Property Values,"
University of Wisconsin Press, vol. 81(4).
- Joseph A. Herriges & Silvia Secchi & Bruce A. Babcock, 2003. "Living with Hogs in Iowa: The Impact of Livestock Facilities on Rural Residential Property Values," Center for Agricultural and Rural Development (CARD) Publications 03-wp342, Center for Agricultural and Rural Development (CARD) at Iowa State University.
- Herriges, Joseph A. & Secchi, Silvia & Babcock, Bruce A., 2003. "Living with Hogs in Iowa: The Impact of Livestock Facilities on Rural Residential Property Values," Staff General Research Papers 10683, Iowa State University, Department of Economics.
- Jan K. Brueckner, 2003. "Strategic Interaction Among Governments: An Overview of Empirical Studies," International Regional Science Review, , vol. 26(2), pages 175-188, April.
- V. Smith & Ju Huang, 1993. "Hedonic models and air pollution: Twenty-five years and counting," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 3(4), pages 381-394, August.
- Brett Day & Ian Bateman & Iain Lake, 2007. "Beyond implicit prices: recovering theoretically consistent and transferable values for noise avoidance from a hedonic property price model," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 37(1), pages 211-232, May.
- Palmquist, Raymond B., 2006. "Property Value Models," Handbook of Environmental Economics, in: K. G. Mäler & J. R. Vincent (ed.), Handbook of Environmental Economics, edition 1, volume 2, chapter 16, pages 763-819 Elsevier.
- Rosen, Sherwin, 1974. "Hedonic Prices and Implicit Markets: Product Differentiation in Pure Competition," Journal of Political Economy, University of Chicago Press, vol. 82(1), pages 34-55, Jan.-Feb..
- Raymond B. Palmquist & Fritz M. Roka & Tomislav Vukina, 1997. "Hog Operations, Environmental Effects, and Residential Property Values," Land Economics, University of Wisconsin Press, vol. 73(1), pages 114-124.
- Jeffrey P. Cohen & Cletus C. Coughlin, 2006.
"Spatial hedonic models of airport noise, proximity, and housing prices,"
2006-026, Federal Reserve Bank of St. Louis.
- Jeffrey P. Cohen & Cletus C. Coughlin, 2008. "Spatial Hedonic Models Of Airport Noise, Proximity, And Housing Prices," Journal of Regional Science, Wiley Blackwell, vol. 48(5), pages 859-878.
- Arthur C. Nelson & John Genereux & Michelle Genereux, 1992. "Price Effects of Landfills on House Values," Land Economics, University of Wisconsin Press, vol. 68(4), pages 359-365.
- Andersson, Henrik & Jonsson, Lina & Ögren, Mikael, 2008.
"Property Prices and Exposure to Multiple Noise Sources: Hedonic Regression with Road and Railway Noise,"
2008:10, Swedish National Road & Transport Research Institute (VTI).
- Henrik Andersson & Lina Jonsson & Mikael Ögren, 2010. "Property Prices and Exposure to Multiple Noise Sources: Hedonic Regression with Road and Railway Noise," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 45(1), pages 73-89, January.
- ANDERSSON Henrik & JONSSON Lina & OGREN Mikael, 2008. "Property Prices and Exposure to Multiple Noise Sources: Hedonic Regression with Road and Railway Noise," LERNA Working Papers 08.25.269, LERNA, University of Toulouse.
- Jean-Daniel Saphores & Ismael Aguilar-Benitez, 2005. "Smelly local polluters and residential property values: A hedonic analysis of four Orange County (California) cities," Estudios Económicos, El Colegio de México, Centro de Estudios Económicos, vol. 20(2), pages 197-218.
- J. Barkley Rosser, 2009. "Introduction," Chapters, in: Handbook of Research on Complexity, chapter 1 Edward Elgar.
- G�ran Therborn & K.C. Ho, 2009. "Introduction," City, Taylor & Francis Journals, vol. 13(1), pages 53-62, March.
When requesting a correction, please mention this item's handle: RePEc:hub:wpecon:201119. 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: (Sabine Janssens)
If references are entirely missing, you can add them using this form.