Does Hazardous Waste Matter? Evidence from the Housing Market and the Superfund Program^*

Abstract

Approximately $30 billion (2000$) has been spent on Superfund clean-ups of hazardous waste sites, and remediation efforts are incomplete at roughly half of the 1,500 Superfund sites. This study estimates the effect of Superfund clean-ups on local housing price appreciation. We compare housing price growth in the areas surrounding the first 400 hazardous waste sites to be cleaned up through the Superfiind program to the areas surrounding the 290 sites that narrowly missed qualifying for these clean-ups. We cannot reject that the clean-ups had no effect on local housing price growth, nearly two decades after these sites became eligible for them. This finding is robust to a series of specification checks, including the application of a quasi-experimental regression discontinuity design based on knowledge of the selection rule.Overall, the preferred estimates suggest that the benefits of Superfund clean-ups as measured through the housing market are substantially lower than the $43 million mean cost of Superfund cleanups.

Cancer values of prevented fatalities (VPFs), one size does not fit all: The benefits of contaminated site cleanups in Italy

“…Since it requires estimates of the mortality risks associated with hazardous waste exposures, and it focuses exclusively on mortality risks, it is different from that suggested in Kiel and Zabel (2001) or Greenstone and Gallagher (2008), which use changes in property values associated with discovery of contamination and cleanup to estimate the benefits of Superfund and related cleanup programs. Gayer et al (2000Gayer et al ( , 2002 and Davis (2004) infer the value of a statistical case of cancer from the depreciation and appreciation in property values observed as information is released about risks at specific locations.…”

Waste Sites and Property Values: A Meta-Analysis

“…This assessment is timely in view of recent studies suggesting that some of the most contaminated sites in the United States-those selected for the NPL under the federal Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA, commonly known as the Superfund Law)-have idiosyncratic (Kiel and Williams 2007) or no discernable effects (Greenstone and Gallagher 2008) on nearby property values. NPL sites are supposedly those that present the greatest risk to human health.…”

Econometric analysis of cleanup of illegal dumping sites in Japan: removal or remedial actions?

“…Sigman and Stafford (2010) reviewed the socioeconomic literature on regulation of hazardous waste and cleanup of contaminated sites, focusing on empirical analysis. Relatively more existing studies have examined property values before and after cleanup using stated preference approaches and hedonic price techniques (e.g., Alberini et al 2005;McCluskey and Rausser 2003;Greenstone and Gallagher 2008;US Environmental Protection Agency 2009). However, fewer studies show comprehensive empirical evidence for the decision-making process, costs, and periods regarding cleanup options.…”