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Drought and Property Prices: Empirical Evidence from Provinces of Iran

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  • Mohammad Reza Farzanegan

    (Philipps-Universität Marburg)

  • Mehdi Feizi

    (Ferdowsi University of Mashhad)

  • Hassan F. Gholipour

    (Western Sydney University)

Abstract

This study examines the effect of drought on housing and residential land prices in Iran. Using panel data covering the 2006–2015 period for 31 provinces of Iran and applying a dynamic system and the difference Generalized Methods of Moments (GMM) methods, we find that an increase in the balance of water (reducing the severity of drought) within provinces has a positive effect on property prices. Our results are robust, controlling for province fixed effects, time trend, and a set of control variables that may affect property prices.

Suggested Citation

  • Mohammad Reza Farzanegan & Mehdi Feizi & Hassan F. Gholipour, 2021. "Drought and Property Prices: Empirical Evidence from Provinces of Iran," Economics of Disasters and Climate Change, Springer, vol. 5(2), pages 203-221, July.
    • Handle: RePEc:spr:ediscc:v:5:y:2021:i:2:d:10.1007_s41885-020-00081-0
    DOI: 10.1007/s41885-020-00081-0
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    More about this item

    Keywords

    Drought; Property prices; Residential land; Housing; Iran;
    All these keywords.

    JEL classification:

    • R21 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Housing Demand
    • R31 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Housing Supply and Markets
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

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