Quasi-Experiments and Hedonic Property Value Methods

Christopher Parmeter and Jaren Pope

No 2012-7, Working Papers from University of Miami, Department of Economics

Abstract: There has recently been a dramatic increase in the number of papers that have combined quasi-experimental methods with hedonic property models. This is largely due to the concern that cross-sectional hedonic methods may be severely biased by omitted variables. While the empirical literature has developed extensively, there has not been a consistent treatment of the theory and methods of combining hedonic property models with quasi-experiments. The purpose of this chapter is to fill this void. An effort is made to provide background information on the traditional hedonic theory, the traditional cross-sectional hedonic methods as well as the newer quasi-experimental hedonic methods that use program evaluation techniques. By connecting these two literatures, the underlying theoretical and empirical assumptions necessary to estimate the marginal willingness to pay for a housing characteristic are highlighted. The chapter also provides a practical how to guide on implementing a quasi-experimental hedonic analysis. This is done by focusing on a series of steps that can help to ensure the reliability of a quasi-experimental identification strategy. We illustrate this process using several recent papers from the literature.

Keywords: Regression Discontinuity; Differences-in-Differences; Property Value; Program Evaluation; Marginal Willingness to Pay; Capitalization (search for similar items in EconPapers)
JEL-codes: C9 D6 Q5 R0 (search for similar items in EconPapers)
Pages: 92 pages
Date: 2012-02-09
New Economics Papers: this item is included in nep-ecm and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (12)

Forthcoming: Under Review

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https://www.herbert.miami.edu/_assets/files/repec/WP2012-07.pdf First version, 2012 (application/pdf)

Related works:
Chapter: Quasi-experiments and hedonic property value methods (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:mia:wpaper:2012-7

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