Sometimes Close is Good Enough: The Value of Nearby Environmental Amenities
An extensive empirical literature exists showing that variations in region-specific amenities can account for persistent differences in real wages across regions. However, this literature has considered only amenities in the same location as the household. This paper argues that environmental amenities at some distance from but accessible to urban areas may lead to negative compensating wage differentials. We use a general equilibrium framework and data from the 1995 Current Population Survey to calculate implicit amenity prices based on measures of distance to environmental amenities. Our results suggest that amenities outside the metropolitan area do generate compensating wage differentials, as workers are willing to accept lower wages to live in accessible proximity to "nice" places. This implies that these places provide a positive externality to those communities that find them accessible. The estimated effects are quantitatively important, suggesting that these externalities should be taken into account in policy making.
|Date of creation:||Sep 2003|
|Publication status:||published in Journal of Regional Science 46(5): 931-951.|
|Contact details of provider:|| Postal: Williamstown, MA 01267|
Phone: 413 597 2476
Fax: 413 597 4045
Web page: http://econ.williams.edu
More information through EDIRC
|Order Information:|| Email: |
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.:
- Blomquist, Glenn C & Berger, Mark C & Hoehn, John P, 1988. "New Estimates of Quality of Life in Urban Areas," American Economic Review, American Economic Association, vol. 78(1), pages 89-107, March.
- Rappaport, Jordan & Sachs, Jeffrey D, 2003. "The United States as a Coastal Nation," Journal of Economic Growth, Springer, vol. 8(1), pages 5-46, March.
- Donna K. Ginther & Madeline Zavodny, 2001.
"Is the male marriage premium due to selection? The effect of shotgun weddings on the return to marriage,"
Journal of Population Economics,
Springer;European Society for Population Economics, vol. 14(2), pages 313-328.
- Donna K. Ginther & Madeline Zavodny, 1998. "Is the male marriage premium due to selection? The effect of shotgun weddings on the return to marriage," FRB Atlanta Working Paper 97-5, Federal Reserve Bank of Atlanta.
- Hausman, Jerry, 2015.
"Specification tests in econometrics,"
Publishing House "SINERGIA PRESS", vol. 38(2), pages 112-134.
- Darius Lakdawalla & Tomas Philipson, 2002.
"The Growth of Obesity and Technological Change: A Theoretical and Empirical Examination,"
NBER Working Papers
8946, National Bureau of Economic Research, Inc.
- Darius Lakdawalla & Tomas Philipson, 2002. "The Growth of Obesity and Technological Change: A Theoretical and Empirical Examination," Working Papers 0203, Harris School of Public Policy Studies, University of Chicago.
- Gyourko, Joseph & Kahn, Matthew & Tracy, Joseph, 1999. "Quality of life and environmental comparisons," Handbook of Regional and Urban Economics, in: P. C. Cheshire & E. S. Mills (ed.), Handbook of Regional and Urban Economics, edition 1, volume 3, chapter 37, pages 1413-1454 Elsevier.
- Beeson, Patricia E., 1991. "Amenities and regional differences in returns to worker characteristics," Journal of Urban Economics, Elsevier, vol. 30(2), pages 224-241, September.
- Smith, V Kerry & Huang, Ju-Chin, 1995. "Can Markets Value Air Quality? A Meta-analysis of Hedonic Property Value Models," Journal of Political Economy, University of Chicago Press, vol. 103(1), pages 209-227, February.
- Glaeser, E. L., 1998.
"Should transfer payments be indexed to local price levels?,"
Regional Science and Urban Economics,
Elsevier, vol. 28(1), pages 1-20, January.
- Edward L. Glaeser, 1996. "Should Transfer Payments Be Indexed to Local Price Levels?," NBER Working Papers 5598, National Bureau of Economic Research, Inc.
- Moulton, Brent R., 1986. "Random group effects and the precision of regression estimates," Journal of Econometrics, Elsevier, vol. 32(3), pages 385-397, August.
- McGranahan, David A., 1999. "Natural Amenities Drive Rural Population Change," Agricultural Economics Reports 33955, United States Department of Agriculture, Economic Research Service.
- Roback, Jennifer, 1982. "Wages, Rents, and the Quality of Life," Journal of Political Economy, University of Chicago Press, vol. 90(6), pages 1257-1278, December.
- Gyourko, Joseph & Tracy, Joseph, 1991. "The Structure of Local Public Finance and the Quality of Life," Journal of Political Economy, University of Chicago Press, vol. 99(4), pages 774-806, August.
- Greenwood, Michael J, et al, 1991. "Migration, Regional Equilibrium, and the Estimation of Compensating Differentials," American Economic Review, American Economic Association, vol. 81(5), pages 1382-1390, December.
- Courant Paul N. & Deardorff Alan V., 1993. "Amenities, Nontraded Goods, and the Trade of Lumpy Countries," Journal of Urban Economics, Elsevier, vol. 34(2), pages 299-317, September.
When requesting a correction, please mention this item's handle: RePEc:wil:wileco:2003-07. 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: (Stephen Sheppard)
If references are entirely missing, you can add them using this form.