Effects of Aquatic Invasive Species on Home Prices: Evidence from Wisconsin

27 Pages Posted: 31 Aug 2013 Last revised: 31 Oct 2014

See all articles by Marianne Johnson

Marianne Johnson

University of Wisconsin - Oshkosh - Department of Economics

Martin Meder

Nicholls State University - College of Business Administration

Date Written: August 27, 2013

Abstract

Our purpose is to examine the extent to which lakefront property owners view the invasive species zebra mussels and water milfoil as a dis-amenities. While both the ecological and aesthetic impacts of milfoil are universally negative, it less clear how property owners might view zebra mussel infestations. An invasive species, zebra mussels negatively affect the local ecology, crowd out some native species, and deposit sharp shells on beaches. However, zebra mussels are also associated with increased water clarity, a reduction in suspended pollutants, and increased numbers of popular game fish, making this an empirical question.We use a hedonic model to estimate the impact of zebra mussel and water milfoil infestations on lakefront property prices in 17 counties in North Central Wisconsin (n=1072). We find a statistically significant, negative association between sales price and milfoil infestations that is consistent with previous studies. In contrast, zebra mussel infestations are associated with higher property sales prices. The results suggest that generating compliance with containment and mitigation strategies may be difficult as lake users do not perceive a cost to zebra mussel infestation.

Keywords: invasive species, zebra mussels, Eurasian water milfoil, property values

JEL Classification: Q51, Q57

Suggested Citation

Johnson, Marianne and Meder, Martin, Effects of Aquatic Invasive Species on Home Prices: Evidence from Wisconsin (August 27, 2013). Available at SSRN: https://ssrn.com/abstract=2316911 or http://dx.doi.org/10.2139/ssrn.2316911

Marianne Johnson (Contact Author)

University of Wisconsin - Oshkosh - Department of Economics ( email )

800 Algoma Blvd.
Oshkosh, WI 54901
United States
920-424-2230 (Phone)
920-424-1734 (Fax)

Martin Meder

Nicholls State University - College of Business Administration ( email )

Thibodaux, LA
United States

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