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Valuing Public Goods, the Time to Capitalization, and Network Externalities: A Spatial Hedonic Regression Analysis

Valuing Public Goods, the Time to Capitalization, and Network Externalities: A Spatial Hedonic... ABSTRACT: Valuation studies of public goods, such as a bike trail, typically fail to consider the time to capitalization. Expanding upon previous hedonic housing models, we show that the years since development of the good is an important factor in estimating its value. Using spatial analysis for housing in Bloomington, Illinois, We find the development of a bike trail has an initial negative impact on prices, but over time the value of the trail turns positive, suggesting network effects and information costs impact valuation estimates. Additional analysis finds that networked trail access has a greater impact than nonnetworked trail access. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Land Economics University of Wisconsin Press

Valuing Public Goods, the Time to Capitalization, and Network Externalities: A Spatial Hedonic Regression Analysis

Land Economics , Volume 93 (1) – Jan 19, 2017

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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
Publisher site
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Abstract

ABSTRACT: Valuation studies of public goods, such as a bike trail, typically fail to consider the time to capitalization. Expanding upon previous hedonic housing models, we show that the years since development of the good is an important factor in estimating its value. Using spatial analysis for housing in Bloomington, Illinois, We find the development of a bike trail has an initial negative impact on prices, but over time the value of the trail turns positive, suggesting network effects and information costs impact valuation estimates. Additional analysis finds that networked trail access has a greater impact than nonnetworked trail access.

Journal

Land EconomicsUniversity of Wisconsin Press

Published: Jan 19, 2017

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