Hedonic Property Prices and Coastal Beach Width

45 Pages Posted: 31 Jul 2014 Last revised: 3 Dec 2019

See all articles by Craig E. Landry

Craig E. Landry

UGA Ag & Applied Economics

Dylan Turner

University of Georgia - Department of Agricultural & Applied Economics

Tom Allen

East Carolina University

Date Written: October 1, 2019

Abstract

Previous research suggests that coastal housing values capitalize the quality of nearby beaches, with distance from the shore playing a key role, and that there are potential problems related to measurement errors and reverse causation due to policy interventions. We offer the first analysis in communities that are not engaging in beach replenishment, obviating concern over reverse causation. Statistical evidence supports hedonic specifications that account for proximity to the shoreline. Using geophysical seascape measures as instrumental variables (IV) for beach width, we find mixed evidence of errors-in-variables across market segments (existing homes v. vacant lots). When we do find downward bias in marginal WTP for beach width at vacant lots, it is rather large (142\% to 350\%).

Keywords: coastal, erosion, beach, width, hedonic, housing, prices

JEL Classification: Q32, Q51, Q54, Q57

Suggested Citation

Landry, Craig and Turner, Dylan and Allen, Tom, Hedonic Property Prices and Coastal Beach Width (October 1, 2019). Available at SSRN: https://ssrn.com/abstract=2474276 or http://dx.doi.org/10.2139/ssrn.2474276

Craig Landry (Contact Author)

UGA Ag & Applied Economics ( email )

Athens, GA 30602-7509
United States

Dylan Turner

University of Georgia - Department of Agricultural & Applied Economics ( email )

Athens, GA 30602-7509
United States

Tom Allen

East Carolina University ( email )

Greenville, NC 27858
United States

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