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The effect of Tourism on the House Market: the case of Sardinia


  • Bianca Biagi


  • Alessandra Faggian



This paper focuses on the effect of tourism on quality of life (QOL). Two opposite streams of thoughts exist in the related literature. On one side, tourism is seen to be a factor of development, increasing economic opportunities and therefore affecting the QOL of local residents in a positive way. On the other side, tourism is considered a factor of pressure on local areas, because it exploits natural, social and infrastructural resources therefore negatively influencing the QOL.We collected data on all the municipalities in Sardinia (the most famous Italian island as seaside resort) to try and test whether the QOL in touristic locations is positively affected by the presence of tourists. In order to measure the contribution of tourism to QOL, we applied the hedonic price method (HPM). With this methodology, the willingness to pay for QOL, i.e. its “implicit price”, is measured by the differences in property market prices. In particular, our results show that there is a clear distinction between QOL in coastal touristic locations and inland non-touristic places. This confirms our initial idea, that, under certain conditions, tourism can be seen as a positive factor rather than a negative externality. It, indeed, fosters local communities to develop appropriate amenities and facilities. In the final part of the paper, we used the results obtained in the empirical section to propose a classification of all Sardinian municipalities based on the implicit price of QOL. Key words: QOL, HPM.

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  • Bianca Biagi & Alessandra Faggian, 2004. "The effect of Tourism on the House Market: the case of Sardinia," ERSA conference papers ersa04p44, European Regional Science Association.
  • Handle: RePEc:wiw:wiwrsa:ersa04p44

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    References listed on IDEAS

    1. 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..
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    Cited by:

    1. Bianca Biagi & Maria Gabriela Ladu & Vicente Royuela, 2015. "“Human development and tourism specialization. Evidence from a panel of developed and developing countries”," IREA Working Papers 201505, University of Barcelona, Research Institute of Applied Economics, revised Jan 2015.
    2. Bianca Biagi & Manuela Pulina, 2006. "Regional Public Policy and Tourism Life Cycle: the Case of Sardinia," ERSA conference papers ersa06p65, European Regional Science Association.
    3. B. Biagi & MG. Brandano & D. Lambiri, 2012. "Does tourism affect house prices? Some evidence from Italy," Working Paper CRENoS 201227, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.

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