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

Arlan Brucal and John Lynham

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

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.

Keywords: Seawalls; Hedonic valuation; Coastal erosion; Property values (search for similar items in EconPapers)
JEL-codes: H23 Q26 Q51 Q54 (search for similar items in EconPapers)
Pages: 23 pages
Date: 2021-01-01
New Economics Papers: this item is included in nep-ure
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Citations: View citations in EconPapers (1)

Published in Environmental Economics and Policy Studies, 1, January, 2021, 23(1), pp. 55 - 77. ISSN: 1432-847X

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Journal Article: Coastal armoring and sinking property values: the case of seawalls in California (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:104324

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