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An Hedonic Analysis of the Effects of Lake Water Clarity on New Hampshire Lakefront Properties

Published online by Cambridge University Press:  15 September 2016

Julie P. Gibbs ,
John M. Halstead ,
Kevin J. Boyle  and
Ju-Chin Huang
Julie P. Gibbs
Affiliation:
U.S. Army Corps of Engineers, Southwest Region
John M. Halstead
Affiliation:
Department of Resource Economics and Development, University of New Hampshire
Kevin J. Boyle
Affiliation:
Department of Resource Economics and Policy, University of Maine
Ju-Chin Huang
Affiliation:
Department of Economics, University of New Hampshire
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Abstract

Policy makers often face the problem of evaluating how water quality affects a region's economic well-being. Using water clarity as a measure of the degree of eutrophication levels (as a lake becomes inundated with nutrients, water clarity decreases markedly), analysis is performed on sales data collected over a six-year period. Our results indicate that water clarity has a significant effect on prices paid for residential properties. Effects of a one-meter change in clarity on property value are also estimated for an average lake in four real estate market areas in New Hampshire, with effects differing substantially by area. Our findings provide state and local policy makers a measure of the cost of water quality degradation as measured by changes in water clarity, and demonstrate that protecting water quality may have a positive effect on property tax revenues.

Keywords

eutrophicationhedonicswater claritywater quality
Type
Articles
Information
Agricultural and Resource Economics Review , Volume 31 , Issue 1 , April 2002 , pp. 39 - 46
Copyright
Copyright © 2002 Northeastern Agricultural and Resource Economics Association 

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