Hedonic property price models have been used extensively in the economics literature to measure the value households place on locating properties close to a given resource, such as a beach, river, or lake. This proximity premium consists of two components. First, property owners derive benefit from living close to the resource for access purposes. Second, they also derive benefit from the view of the resource. Critical to the analyses is the identification and measurement of these two components. We augment previous research by providing more accurate and objective measures of access and view for urban beach residential properties. Using GIS, we calculate the distance from each property to the nearest designated public access point. Using lidar data, we calculate the ocean view from each property. These measures are then integrated into a hedonic property price model to disentangle and estimate households' willingness to pay for beach access and view.
We use contingent behavior analysis to study the effects of pfiesteria-related fish kills on the demand for seafood in the Mid-Atlantic region. We estimate a set of demand difference models based on individual responses to questions about seafood consumption in the presence of fish kills and with different amounts of information provided about health risks. We use a random-effects Tobit model to control for correlation across each observation and to account for censoring. We find that (i) pfiesteria-related fish kills have a significant negative effect on the demand for seafood even though the fish kills pose no known threat to consumers through seafood consumption, (ii) seafood consumers are not responsive to expert risk information designed to reassure them that seafood is safe in the presence of a fish kill, and (iii) a mandatory seafood inspection program largely eliminates the welfare loss incurred due to misinformation.
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