Coastal armoring and sinking property values: the case of seawalls in California

Brucal, Arlan and Lynham, John (2021) Coastal armoring and sinking property values: the case of seawalls in California. Environmental Economics and Policy Studies, 23 (1). 55 - 77. ISSN 1432-847X

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Abstract

Rising sea levels necessitate careful consideration of different forms of coastal protection but cost-benefit analysis is limited when important non-market social costs have not been measured. Seawalls protect individual properties but can potentially impose negative externalities on neighboring properties via accelerated beach loss. We conduct a hedonic valuation of seawalls in two coastal California counties: San Diego and Santa Cruz. We find no strong evidence to suggest that the presence of a seawall is positively correlated with the value of the home protected. However, we find that seawalls are strongly negatively correlated with the value of neighboring properties in Santa Cruz but not in San Diego county, suggesting that the effect of seawalls depend on certain geographical attributes. Our results are robust to accounting for the public-good nature of locational attributes and the potential spatial dependence of housing prices. Simulation reveals that doubling the extent of seawalls in San Diego and Santa Cruz could reduce property tax revenues by $7 million and $54 million, respectively.

Item Type:	Article
Official URL:	https://www.springer.com/journal/10018
Additional Information:	© 2020 The Authors
Divisions:	Geography & Environment Grantham Research Institute
Subjects:	H Social Sciences > HC Economic History and Conditions G Geography. Anthropology. Recreation > GE Environmental Sciences
JEL classification:	H - Public Economics > H2 - Taxation, Subsidies, and Revenue > H23 - Externalities; Redistributive Effects; Environmental Taxes and Subsidies Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics > Q2 - Renewable Resources and Conservation > Q26 - Recreational Aspects of Natural Resources Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics > Q5 - Environmental Economics > Q51 - Valuation of Environmental Effects Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics > Q5 - Environmental Economics > Q54 - Climate; Natural Disasters
Date Deposited:	11 May 2020 10:18
Last Modified:	15 Nov 2024 22:15
URI:	http://eprints.lse.ac.uk/id/eprint/104324

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