Local Environmental Quality and Life-Satisfaction in Germany

Katrin Rehdanz and David Maddison

No FNU-119, Working Papers from Research unit Sustainability and Global Change, Hamburg University

Abstract: Hitherto the task of valuing differences in environmental quality arising from air pollution and noise nuisance has been carried out mainly by using the hedonic price technique. This paper proposes a different approach to deriving information on individual preferences for local environmental quality. It analyses data drawn from the German socio economic panel in an attempt to explain differences in self-reported levels of well-being in terms of environmental quality. Mindful of existing research a large number of other explanatory variables are included to control for socio-demographic differences, economic circumstances as well as neighbourhood characteristics. Differences in local air quality and noise levels are measured by how much an individual feels affected by air pollution or noise exposure in their residential area. The evidence suggests that even when controlling for a range of other factors higher local air pollution and noise levels significantly diminish subjective well-being. But interestingly differences in perceived air and noise pollution are not capitalised into differences in house prices.

Keywords: air pollution; environmental quality; Germany; life-satisfaction; noise exposure; well-being (search for similar items in EconPapers)
JEL-codes: Q53 Q58 R19 (search for similar items in EconPapers)
Pages: 24 pages
Date: 2006-09, Revised 2006-09
New Economics Papers: this item is included in nep-eec, nep-ene, nep-env and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Journal Article: Local environmental quality and life-satisfaction in Germany (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:sgc:wpaper:119

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