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Valuing the environmental benefits of canals and canal restoration using house prices

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  • Gibbons, Stephen
  • Peng, Cong
  • Tang, Cheng Keat
Abstract
This article values the environmental benefits of historic, navigable canals using property values. We improve on standard methods by controlling for microgeographic fixed effects and applying a difference-in-differences method to canal restoration. We find a localized price premium within 100 m, around 5% before the 2008 recession, dropping to 3.4% by 2016. These effects are driven by urban canal-side properties with a direct outlook on the canals or immediate access. These locations are also attractive for developers, with a higher proportion of new-build sales. Our estimates suggest that canals generate land value uplift of £0.8–£0.9 billion in England.

Suggested Citation

  • Gibbons, Stephen & Peng, Cong & Tang, Cheng Keat, 2021. "Valuing the environmental benefits of canals and canal restoration using house prices," LSE Research Online Documents on Economics 107931, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:107931
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    References listed on IDEAS

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    1. Seong-Hoon Cho & Seung Gyu Kim & Roland Roberts, 2011. "Values of environmental landscape amenities during the 2000-2006 real estate boom and subsequent 2008 recession," Journal of Environmental Planning and Management, Taylor & Francis Journals, vol. 54(1), pages 71-91.
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    6. Tang, Cheng Keat, 2021. "The Cost of Traffic: Evidence from the London Congestion Charge," Journal of Urban Economics, Elsevier, vol. 121(C).
    7. Janet Currie & Lucas Davis & Michael Greenstone & Reed Walker, 2015. "Environmental Health Risks and Housing Values: Evidence from 1,600 Toxic Plant Openings and Closings," American Economic Review, American Economic Association, vol. 105(2), pages 678-709, February.
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    9. Mooney, Sian & Eisgruber, Ludwig M, 2001. "The Influence of Riparian Protection Measures on Residential Property Values: The Case of the Oregon Plan for Salmon and Watersheds," The Journal of Real Estate Finance and Economics, Springer, vol. 22(2-3), pages 273-286, March-May.
    10. Leigh Linden & Jonah E. Rockoff, 2008. "Estimates of the Impact of Crime Risk on Property Values from Megan's Laws," American Economic Review, American Economic Association, vol. 98(3), pages 1103-1127, June.
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    Cited by:

    1. Hearne, David & Yerushalmi, Erez, 2023. "Do Bicycle Networks Have Economic Value? A Hedonic Application to Greater Manchester," CAFE Working Papers 24, Centre for Accountancy, Finance and Economics (CAFE), Birmingham City Business School, Birmingham City University.

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    More about this item

    Keywords

    canals; waterways; house prices; environment; valuation; revealed preference; UKRI block grant;
    All these keywords.

    JEL classification:

    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects

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