Market Value of Mitigation and Perceived Risk: Empirical Results

Kevin M. Simmons and Jamie Brown Kruse
Additional contact information
Kevin M. Simmons: Oklahoma City University
Jamie Brown Kruse: Texas Tech University

Journal of Economic Insight, 2000, vol. 26, issue 1, 41-51

Abstract: This paper explores the value of windstorm mitigation in a Gulf Coast city. Policymakers have long assumed that agents will not voluntarily mitigate for a natural disaster. Consequently, policy has focused on coercive measures. Data for the study contains detailed information on the inclusion of storm-blinds, a specific hurricane mitigation feature. Results indicate that homes with storm- blinds command a premium compared to homes without this feature, thereby questioning the assumption held by policymakers. This result, however, is limited to homes located on the island portion of the community indicating that agents differentiate the risk from one area to another.

JEL-codes: D8 (search for similar items in EconPapers)
Date: 2000
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Citations: View citations in EconPapers (10)

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Persistent link: https://EconPapers.repec.org/RePEc:mve:journl:v:26:y:2000:i:1:p:41-51

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