Spatial Hedonic Models of Airport Noise, Proximity, and Housing Prices

FRB of St. Louis Working Paper No. 2006-026C

34 Pages Posted: 27 Apr 2006  

Jeffrey P. Cohen

University of Connecticut - School of Business

Cletus C. Coughlin

Federal Reserve Bank of St. Louis - Research Division

Multiple version iconThere are 2 versions of this paper

Date Written: September 2007

Abstract

Despite the refrain that housing prices are determined by "location, location, and location," no prior studies of airport noise and housing prices have incorporated spatial econometric techniques. We compare various spatial econometric models and estimation methods in a hedonic price framework to examine the impact of noise on 2003 housing values near the Atlanta airport. Spatial effects are best captured by a model including both spatial autocorrelation and autoregressive parameters estimated by a generalized moments approach. The inclusion of spatial effects magnifies the negative price impacts of airport noise. Finally, after controlling for noise, houses farther from the airport tend to sell for less, implying that airport proximity is an amenity.

Keywords: noise, airports, housing prices, hedonic pricing, spatial econometrics

JEL Classification: Q53, Q51, R31, L93, C21

Suggested Citation

Cohen, Jeffrey P. and Coughlin, Cletus C., Spatial Hedonic Models of Airport Noise, Proximity, and Housing Prices (September 2007). FRB of St. Louis Working Paper No. 2006-026C . Available at SSRN: https://ssrn.com/abstract=898635 or http://dx.doi.org/10.2139/ssrn.898635

Jeffrey P. Cohen (Contact Author)

University of Connecticut - School of Business ( email )

368 Fairfield Road
Storrs, CT 06269-2041
United States

Cletus C. Coughlin

Federal Reserve Bank of St. Louis - Research Division ( email )

411 Locust St
Saint Louis, MO 63011
United States

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