Monday, January 17, 2022

Systematic Variation in Waste Site Effects on Residential Property Values: A Meta-Regression Analysis and Benefit Transfer

This article presents a meta-analysis based on 727 estimates from 83 hedonic pricing studies to provide new insights on the effects of waste sites on residential property values. Relative to previous meta-analyses on this subject, estimates are corrected for publication bias and the ability of the meta-regression model to produce reliable benefit-transfer estimates is assessed. Proximity to severely contaminated waste sites has a supremely negative impact on residential property values, whereas on average the distance from non-hazardous waste sites has no effect. Correcting for publication bias has a sizeable impact, reducing the average effect size by up to 38%. Benefit-transfer errors based on the meta-regression model are fairly large and, in line with the broader literature, outperform simple value transfer when the underlying data sample is heterogeneous. 
The corrected average effect size translates into a 1.5% to 2.9% property value increase per mile of increased distance from a waste site for a house at a one-mile distance. These estimates are situated in the lower range of values produced by the previous literature. The results are generally robust across justifiable estimators, weighting schemes and the replacement of moderators.
The subsample analyses revealed distinct differences for severely contaminated sites on the NPL and non-hazardous waste sites. As non-hazardous waste sites do not reduce property values on average, they are not considered a disamenity in these average cases. By contrast, severely contaminated waste sites on the NPL clearly reduce residential property values on average, with an estimated mean effect size of 42.2%. 

by Marvin Schütt; Institute for Environmental, Resource and Spatial Economics, Kiel University, Wilhelm-Selig-Platz 1, 24118, Kiel, Germany
Environmental and Resource Economics via Springer
Volume 78, 2021; Pages 381–416; Published: 24 February 2021

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