Social Stigma and Asset Value

Patrick Gourley

Southern Economic Journal, 2019, vol. 85, issue 3, 919-938

Abstract: Recent attempts by economists to identify and quantify the effect of social stigma on asset value have often been stymied by confounding mechanisms. I use the unique circumstances surrounding the 1999 Columbine Shooting to estimate the effect of social stigma on asset value. Using a difference‐in‐differences model with property fixed effects, I find the immediate effect of stigma from the Columbine Shooting is 5.7% of a property's value after one year. This implies a $13 million loss from property sales in the year 2000 alone. The results are robust to numerous specifications and synthetic control placebo tests. This suggests that social stigma plays a role in consumer preferences.

Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:wly:soecon:v:85:y:2019:i:3:p:919-938

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