No abstract

Profitable extraction of previously inaccessible shale energy reserves has led to the rapid expansion of shale exploration across the United States. We present one of the first empirical studies to measure the impact of early shale exploration on surrounding homeowners using data from Washington County, Pennsylvania, from 2008 to mid 2010. We find that property values are negatively impacted by shale gas exploration activity, but this impact depends on the proximity and intensity of shale activity and is largely transitory. The negative effects are larger for households located close to major highways and sourced with private well water.

Many researchers have addressed concerns of omitted variable bias in hedonic price models through the use of spatial fixed effects. We argue that this approach does not consider the biases introduced by effects that overlap the zone of capitalization for nonmarket goods. We show this bias can dominate the usual omitted variable bias using data on developer-provided open space. We control for multiscale capitalization and omitted variables simultaneously by extending the Hausman-Taylor estimator where the panel component of the estimator is defined over repeated transactions within neighborhoods rather than the traditional definition following a unique cross-sectional unit through time. © 2011 The President and Fellows of Harvard College and the Massachusetts Institute of Technology.

Over the past decade harmful algal blooms (HABs) have become a nationwide environmental concern. HABs are likely to increase in frequency and intensity due to rising summer temperatures caused by climate change and higher nutrient enrichment from increased urbanization. Policymakers need information on the economic costs of HABs to design optimal management policies in the face of limited budgets. Using a detailed, multilake hedonic analysis across 6 Ohio counties between 2009 and 2015 we show capitalization losses associated with near lake homes between 12% and 17% rising to over 30% for lake adjacent homes. In the case of Grand Lake Saint Marys, we find capitalization losses exceeding $48 million for near lake homes which dwarfs the State of Ohio's cleanup expenditure of $26 million.

This paper evaluates the relative effectiveness of FEMA expenditures on hurricane induced property losses. We find that spending on FEMA ex-ante mitigation and planning projects leads to greater reductions in property losses than spending on ex-post adaptation programsspecifically, a one percent increase in annual spending on ex-ante risk reduction and warning projects reduces damages by 0.21 percent while a one percent increase in ex-post recovery and clean-up spending reduces damages by 0.12. Although both types of program spending are effective, we find the marginal return from spending on programs that target longterm mitigation and risk management to be almost twice that of spending on ex-post recovery programs. With the predicted increases in the frequency and severity of North Atlantic hurricanes in the future, our findings suggest there are important potential gains that could be realized from the further diversification of FEMA spending across project categories.