An Economic Evaluation of Beach Erosion Management Alternatives

Abstract

This paper examines the relative economic efficiency ofthree distinct beach erosion management policies ,-beach nourishment with shoreline armoring, beach nourishment wilholll armoring, and shoreline retreat. The analysis focuses on (i} the recreational benefits of beaches, (OJ the property value effects ofbeach management, and (iii) the costs associated with the three managemelll scenarios. Assuming the removal ofshoreline llrmoring improves overall beach quality, beach nourishment with shoreline armoring is the least desirable olthe three alternatives. The countervailing property losses under a retreat strategy are ofthe same order ofmagnitude as the foregone management costs when the beneficial effects of retreat-higher values ofhOllsing sen'ices for those houses not lost to erosion-are considered. The relative desirability of these alternative strategies depends upon the realized erosion rate and holl' manogemelll costs change over time.

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

“…RP and SP data are often combined, which allows for greater flexibility and improved statistical efficiency. Landry, Keeler, and Kriesel (2003) identify primary beneficiaries of beach erosion control as coastal property owners and beach visitors. We review the literature on empirical benefit estimation for each of the groups in turn, and then consider other prospective benefits.…”

“…Table 1 also includes the level of initial beach quality with which marginal WTP is associated. Pompe and Rinehart (1995) estimate the implicit marginal value of high-tide beach width in South Carolina, and Landry, Keeler, and Kriesel (2003) focus on low-tide beach width in Georgia. The estimates are difficult to compare given differences in the way economic value is specified (e.g., the relationship between beach quality and distance from the shore, functional form, and content of the regression equation) and the way beach width is measured (e.g., in relation to tides and units of measurement), but each of these studies finds a positive and statistically significant marginal value for beach width.…”

“…These studies, however, includes multiple years of sales data while utilizing an estimate of beach width from a single time period. Landry, Keeler, and Kriesel (2003) recognize potential bias in this approach given the dynamic nature of beaches and the possibility of periodic interventions due to beach replenishment operations; sales data should be matched with contemporaneous information on beach quality for accurate analysis. Pompe and Rinehart (1999) use time-series beach quality data to address this problem.…”

“…This has not been attempted for hedonic property models of beach quality. Landry, Keeler, and Kriesel (2003), Landry (2008), Smith et al (2009), andGopalakrishnan et al (2011) use the parameterized hedonic price function to estimate property owner benefits attributable to beach width. This approach assumes that there is no heterogeneity in individual preferences for beach quality (Palmquist 2006).…”

“…Regression models employing hedonic property price analysis can be used to address each of these problems. A properly specified regression model can be used to estimate current market value, can be used to estimate the value of a vacant lot (if there are data on lot sales), and can predict the change in housing value associated with changing characteristics (Landry, Keeler, and Kriesel 2003;Parsons and Powell 2001). Alternatively, assessed values (from tax collector records) can be used to proxy for market values.…”