Are land values related to ambient air pollution levels? Hedonic evidence from Mexico City

Lopamudra Chakraborti, David Heres, Danae Hernandez

Research output: Contribution to journalArticlepeer-review

4 Scopus citations

Abstract

This article investigates whether residents of Mexico City value air quality. Our results suggest that air quality improvement in PM 10 is equivalent to a marginal willingness to pay (MWTP) of US$440.31 per property for the period 2006-2013. The corresponding MWTP for PM 2.5 is US$880.63, for O 3 is US$623.78, and for SO 2 is as much as US$2091.50. These estimates are considerably larger in magnitude compared to the few other studies in similar settings. As a percentage of annual household income, these represent 2.44 per cent for PM 10 , 4.88 per cent for PM 2.5 , 3.46 per cent for O 3 and 11.59 per cent for SO 2 . Our estimates of land value-pollution elasticities for PM 10 (-0.26 and - 0.58) are within range of hedonic estimates for total suspended particulate matter in US cities around the 1970s. The corresponding elasticities range from - 0.55 to - 0.84 for PM 2.5 , from - 0.06 to - 0.49 for O 3 and from - 0.11 to - 0.34 for SO 2 .

Original languageEnglish (US)
Pages (from-to)252-270
Number of pages19
JournalEnvironment and Development Economics
Volume24
Issue number3
DOIs
StatePublished - Jun 1 2019
Externally publishedYes

ASJC Scopus subject areas

  • Development
  • Environmental Science(all)
  • Economics and Econometrics

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