The Amenity Value of Climate to German Households

Katrin Rehdanz and David Maddison

No 2004.57, Working Papers from Fondazione Eni Enrico Mattei

Abstract: This study uses the hedonic approach to measure the amenity value of climate in Germany. Unlike in earlier research separate hedonic wage and house price regressions are estimated for relatively small geographic areas and formal tests undertaken to determine whether the coefficients describing the impact of climate variables are homogenous across these areas. Evidence suggests that German households are compensated for climate amenities mainly through hedonic housing markets. Given that climate is largely unproductive to industry and few industries spend more on land than labour this is consistent with what theory would predict. Throughout Germany house prices are higher in areas with higher January temperatures, lower July temperatures and lower January precipitation. In East Germany wages are higher in areas with higher January precipitation. The full implicit price of climate variables however is very uncertain.

Keywords: Climate change; Germany; Hedonic pricing (search for similar items in EconPapers)
JEL-codes: Q29 R29 (search for similar items in EconPapers)
Date: 2004-03
New Economics Papers: this item is included in nep-env and nep-geo
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

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Working Paper: The Amenity Value of Climate to German Households (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:fem:femwpa:2004.57

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