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Assessing the economic benefits of flood defenses: a repeat-sales approach

Beltrán, Allan and Maddison, David and Elliott, Robert J. R. (2018) Assessing the economic benefits of flood defenses: a repeat-sales approach. Risk Analysis. ISSN 0272-4332

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Identification Number: 10.1111/risa.13136

Abstract

In this article we identify the impact of the construction of flood defenses on property prices using a difference‐in‐differences repeat‐sales methodology. Our data set contains information on over 12 million individual property transactions, which is merged with GIS data identifying the spatial location and main characteristics of 1,666 flood defenses built in England between 1995 and 2014. Results suggest that at the finer 6‐digit postcode level the construction of flood defenses raises urban house prices by 12.6% to 16.7%. However, for rural properties at the slightly coarser 5‐digit postcode level the construction of defenses reduces house prices by 0.8% to 5.0%. This suggests that in certain locations the disamenity impact of flood defenses and the perceived threat of redirected flooding outweigh the benefits of reduced flood risk

Item Type: Article
Official URL: https://onlinelibrary.wiley.com/journal/15396924
Additional Information: © 2018 Society for Risk Analysis
Subjects: G Geography. Anthropology. Recreation > GF Human ecology. Anthropogeography
H Social Sciences > HF Commerce
JEL classification: D - Microeconomics > D1 - Household Behavior and Family Economics > D12 - Consumer Economics: Empirical Analysis
Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics > Q5 - Environmental Economics > Q51 - Valuation of Environmental Effects
R - Urban, Rural, and Regional Economics > R2 - Household Analysis > R21 - Housing Demand
Sets: Departments > Geography and Environment
Date Deposited: 12 Sep 2018 10:53
Last Modified: 12 Sep 2018 11:15
URI: http://eprints.lse.ac.uk/id/eprint/90207

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