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An Alternative to the Standard Spatial Econometric Approaches in Hedonic House Price Models

An Alternative to the Standard Spatial Econometric Approaches in Hedonic House Price Models <p>Omitted, misspecified, or mismeasured spatially varying characteristics are a cause for concern in hedonic house price models. Spatial econometrics or spatial fixed effects have become popular ways of addressing these concerns. We discuss the limitations of standard spatial approaches to hedonic modeling and demonstrate the spatial generalized additive model as an alternative. Parameter estimates for several spatially varying regressors are shown to be sensitive to the scale of the fixed effects and bandwidth dimension used to control for omitted variables. This sensitivity reflects the uncertainty associated with the estimates when the appropriate spatial scale of the controls is unknown.</p> http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Land Economics University of Wisconsin Press

An Alternative to the Standard Spatial Econometric Approaches in Hedonic House Price Models

Land Economics , Volume 91 (2) – Apr 13, 2015

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Publisher
University of Wisconsin Press
Copyright
Copyright by the Board of Regents of the University of Wisconsin System.
ISSN
1543-8325

Abstract

<p>Omitted, misspecified, or mismeasured spatially varying characteristics are a cause for concern in hedonic house price models. Spatial econometrics or spatial fixed effects have become popular ways of addressing these concerns. We discuss the limitations of standard spatial approaches to hedonic modeling and demonstrate the spatial generalized additive model as an alternative. Parameter estimates for several spatially varying regressors are shown to be sensitive to the scale of the fixed effects and bandwidth dimension used to control for omitted variables. This sensitivity reflects the uncertainty associated with the estimates when the appropriate spatial scale of the controls is unknown.</p>

Journal

Land EconomicsUniversity of Wisconsin Press

Published: Apr 13, 2015

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