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AbstractThis paper investigates the economic value of municipal, private, and community‐managed water services in Guatemala through a hedonic analysis of rental housing prices observed in 2006. Hedonic models are jointly estimated with water service choices using a maximum simulated likelihood approach in order to control for potential endogeneity. Findings indicate that the value of piped water depends on the type of water utility. The estimated value of municipal services is at least 15 times as much as the average water bill, while value estimates are not significant for private and community‐managed systems. Value differentials are discussed considering the performance of water utilities and their institutional arrangements.

AbstractMany developing countries lack universal sanitation services for residents. Years of inappropriate disposal of solid waste and wastewater have increased the potential for devastating environmental and health issues. An economic valuation of sanitation services may help in planning investment projects by demonstrating the benefits that households derive from having access to improved sanitation. We examine Guatemala as a case study and employ a series of hedonic models to estimate the value that households in Guatemala assign to the sanitation services of solid waste collection and connections to sewer infrastructure. Findings indicate that residents are willing to pay higher rents for both wastewater and solid waste removal. Policy implications are discussed.

In hedonic valuation studies the policy-relevant environmental quality attribute of interest is often costly to measure, especially under pronounced spatial and temporal variability. However, in many cases this attribute affects home prices and consumer preferences solely through its impact on a readily observable, spatially delineated, and time-invariant feature of the physical landscape. We label such a feature a "translating amenity." We show that under certain conditions changes in the marginal effect of such amenities on home values over time can be used to draw inference on the implicit price of the unobserved environmental quality of interest. We illustrate this approach in the context of a repeat-sales model and the recently intensified outbreak of the Mountain Pine Beetle in the Colorado Front Range. ; Southern Research Station, USDA Forest ServiceUnited States Department of Agriculture (USDA)United States Forest Service ; We thank seminar participants at the 2013 Meetings of the W3133 Western Regional Science Project (Coeur d' Alene, ID, Feb. 27-March 2), and the US Airforce Academy, Colorado Springs (March 15, 2013), for insightful and stimulating comments. Funding provided by the Southern Research Station, USDA Forest Service, is gratefully acknowledged. ; Public domain authored by a U.S. government employee

It has become standard practice to estimate the value of amenities, such as environmental cleanliness, local school quality and crime, using hedonic valuations—typically changes in real estate prices. The accuracy of hedonic valuations depends critically on whether real estate prices adjust appropriately, which is difficult to verify. The 1994 Orange County, CA, bankruptcy offers a test of the accuracy of hedonic real estate valuations. Orange County's failed investment strategy resulted in unexpected county losses of $1.7 billion. In response, the aggregate value of Orange County real estate dropped by between $1.65 and $3.70 billion.

PurposeThe purpose of this paper is to comment upon the use of hedonic pricing models for the valuation of property. This model can be particularly useful for some housing markets.Design/methodology/approachThis Education Briefing is an explanation of the how hedonic pricing can be useful in looking at the effect of "location" on the house prices within different submarkets using the Italian real estate market as an example.FindingsAlthough, this case study is relatively straightforward, it shows how the application of the market approach can provide insights in cases where the comparable properties belong to different submarkets with relatively few transactions.Practical implicationsIn cases of mass appraisals, hedonic pricing models can provide a broad indication of value across submarkets.Originality/valueThis paper develops a general framework that connects multiple regression analysis, direct comparison model and submarket binary variables.