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The Adverse Impact of Particulate Matter on Property Values

Author

Listed:
  • Mark P. Berkman

    (The Brattle Group ¡V 201 Mission Street, Suite 2800, San Francisco, CA 94105)

  • Kyle J. Hubbard

    (The Brattle Group - 201 Mission Street, Suite 2800, San Francisco, CA 94105)

  • Timothy H. Savage

    (Finance Scholars Group ¡V 675 Third Avenue, 18th Floor, New York, NY 10017)

Abstract

Recent litigation with regards to property damage associated with carbon black emissions provides an opportunity to measure the impact of particulate matter (PM), a Clean Air Act pollutant. By using property-specific PM concentrations, we estimate the impact of PM on residential property values, which accounts for relevant characteristics and multiple pollution sources. This study simultaneously incorporates all important econometric modeling features cited in the prior literature. We find that a 10-percent increase in PM concentration results in a statistically-significant 1.1-percent decrease in value. In 2007 dollars, a one-standard deviation increase in PM concentration results in a statistically-significant reduction of approximately $4,800.

Suggested Citation

  • Mark P. Berkman & Kyle J. Hubbard & Timothy H. Savage, 2012. "The Adverse Impact of Particulate Matter on Property Values," International Real Estate Review, Global Social Science Institute, vol. 15(2), pages 215-230.
    • Handle: RePEc:ire:issued:v:15:n:02:2012:p:215-230
    as

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    References listed on IDEAS

    as
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    5. Won Kim, Chong & Phipps, Tim T. & Anselin, Luc, 2003. "Measuring the benefits of air quality improvement: a spatial hedonic approach," Journal of Environmental Economics and Management, Elsevier, vol. 45(1), pages 24-39, January.
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    8. Yusuf, Arief Anshory & Resosudarmo, Budy P., 2009. "Does clean air matter in developing countries' megacities? A hedonic price analysis of the Jakarta housing market, Indonesia," Ecological Economics, Elsevier, vol. 68(5), pages 1398-1407, March.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Hedonic; Property value; Particulates; Spatial analysis;
    All these keywords.

    JEL classification:

    • L85 - Industrial Organization - - Industry Studies: Services - - - Real Estate Services

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