Marginal Price of Lake Recreation and Aesthetics: An Hedonic Approach

Abstract

Efficient allocation of water requires knowledge of water's value in both consumptive and nonconsumptive uses. This study estimates the marginal value of water in lake recreational and aesthetic (RA) use. An hedonic price equation (employing the Box-Cox functional form) indicates lake front location, distance to lake, and scenic view are significant RA characteristics of housing. Water front properties command a premium price for the private access they offer. Beyond the water front, the marginal RA price falls rapidly with increasing distance, becoming asymptotic to some minimum. Twenty-two percent of housing price is found to be attributable to the RA component.

Integrating lidar, GIS and hedonic price modeling to measure amenity values in urban beach residential property markets

“…The negative sign on the ACCESS coefficient indicates that individuals are willing to pay more for homes located closer to public access points, ceteris paribus. This result is well supported in the hedonic literature ( [Lansford and Jones, 1995], [Parsons and Noailly, 2004] and [Pompe and Reinhart, 1995]; Bin et al, 2004). Based on this result, we estimate that decreasing distance from each property to the nearest access point by 1 m increases property values by approximately $1119.…”

“…First, access is important. Other studies have shown that households are willing to pay a premium for properties close to a resource (see [Lansford and Jones, 1995], [Parsons and Noailly, 2004] and [Pompe and Reinhart, 1995]; Bin et al, 2004). These studies indicate that there is a value associated with being able to access a beach or a lake for recreational and leisure purposes.…”

Combining Revealed and Stated Preference Methods to Value Environmental Amenities at Residential Locations

“…Numerous studies use hedonic analysis of housing markets to measure the bene® ts of various environmental amenities: air-based amenities (Graves et al 1988); water-based amenities (Brown and Pollakowski 1977;Lansford and Jones 1995;Shabman and Bertelson 1979;Milon, Gressel, and Mulkey 1984); and land-based amenities (Vaughn 1981;Mahan, Polasky, and Adams 1998). (No previous study examines land-based amenities other than parks.) All of these studies apply the hedonic-price model, which assumes that a continuous function relates the price of a house to its attributes and that people select a house by equating the marginal utility of each house attribute to its marginal price.…”

“…As a reasonable compromise, I chose to visit three alternative sites in addition to the purchased site. 6 Some hedonic price studies of water-based amenities link the distance between a housing location and the shoreline of particular water bodies to housing price (Brown and Pollakowski 1977;Lansford and Jones 1995;Milon, Gressel, and Mulkey 1984). The hedonic price framework easily accommodates this link since both variables are treated as continuous.…”

Coastal Erosion as a Natural Resource Management Problem: An Economic Perspective

“…Numerous studies have empirically tested for the influence of environmental amenities on coastal housing markets, including proximity to water (Shabman and Bertelson 1979;Milon, Gressel, and Mulkey 1984;Pompe andRinehart 1995, 1999;Earnhart 2001;Parsons and Powell 2001;Landry, Keeler, and Kriesel 2003;Pompe 2008) and water view (Kulshreshtha and Gillies 1993;Lansford and Jones 1995;Benson et al 1998;Pompe and Rinehart 1999;.…”