The Quality of Life in England and Wales*

Abstract

Local amenities play an important role in determining where we choose to live and our overall quality of life. In many cases, however, amenities do not have prices and will therefore be underprovided by the market. In this paper, we use individual and county level data for England and Wales to estimate implicit amenity prices and to calculate an index of quality of life for each county. Among our …ndings is a large negative price on air pollution. The range in quality of life across counties is estimated to be in excess of two thousand pounds per year. JEL Classification: I31, R1Keywords: Quality of Life index, amenities, hedonic prices.

Implicit amenity prices and the location of retirees in England and Wales

“…The data on amenities come from a variety of sources as detailed in the Appendix. The set of amenities and the data period (1994/5) were chosen to be consistent with Srinivasan and Stewart (2004), which is the source of our amenity wage coefficients, (dw/da i ). These coefficients were estimated using a sample of 12,320 from the 1995 Labour Force Survey, with a standard set of controls for personal characteristics.…”

“…Thus for workers, locations with good amenities will be characterised by high land prices and/or low wages. The framework has been applied not only to amenity pricing but also to generate regional quality of life indices (see, for example, Blomquist, Berger and Hoehn, 1988, Gyourko and Tracy, 1991, Srinivasan and Stewart, 2004, and Berger, Blomquist and Peter, 2008.…”

“…In this paper we apply the model to the location decisions of retirees in England and Wales. Drawing on estimates of amenity prices in Srinivasan and Stewart (2004), we examine variations across counties in the proportion of the population that are retired and migration flows of individuals aged 60 and over. Our findings offer additional support for the model and the associated quality of life indices.…”

Do Geographical Variations in Climate Influence Life-Satisfaction?

“…For our purposes the empirical literature can be classified according to whether climate variables were included incidental to the main purpose of the study (Roback 1982, Hoehn et al 1987, Clark and Cosgrove 1990, Albouy and Leibovici, 2009 or whether climate was the main focus in which case we can further distinguish between studies undertaken in the US (Hoch and Drake 1974, Englin 1996, Nordhaus 1996, Mendelsohn 2001, Albouy 2008, Kahn 2008 and those undertaken elsewhere (Maddison and Bigano 2003, Srinivasan and Stewart 2004, Mueller and Sheriff 2007, Cavailhes et al 2008, Rehdanz and Maddison 2009. 4 A final distinction is that some studies look for compensating differentials for climate in either the housing market (Englin 1996) or the labour market (Hoch and Drake 1974) whereas theory indicates that they can simultaneously appear in both.…”

“…Tuunainen et al 2004). 13 Srinivasan and Stewart (2004) conduct a hedonic analysis of households in England and Wales.…”