Legacies of Lead: Estimating Home Buyer Response to Potential Lead Exposure

Nicholas Irwin

Land Economics, 2020, vol. 96, issue 2, 171-187

Abstract: Excessive levels of lead in homes pose health hazards, but exposure is discerned ex post. As a precaution, local jurisdictions assign risk levels to neighborhoods based on contamination potential and require blood lead testing, leading to decreased desirability. This paper examines capitalization effects of lead risk disclosure from such an information-based policy, exploiting spatially varying implementation of a childhood lead reduction program identifying price effects via a triple-difference border discontinuity model. Information about lead risks lowers high-risk house prices by 7.7% while shifting neighborhood composition, suggesting the program altered risk perceptions, creating unintended consequences in the market.

JEL-codes: Q58 R21 (search for similar items in EconPapers)
Date: 2020
Note: DOI: 10.3368/le.96.2.149
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Persistent link: https://EconPapers.repec.org/RePEc:uwp:landec:v:96:y:2020:i:2:p:171-187

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