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Local Cost for Global Benefit: The Case of Wind Turbines

Gerhard Kussel, Manuel Frondel, Colin Vance () and Stephan Sommer

VfS Annual Conference 2019 (Leipzig): 30 Years after the Fall of the Berlin Wall - Democracy and Market Economy from Verein für Socialpolitik / German Economic Association

Abstract: Given the rapid expansion of wind power capacities in Germany, this paper estimates the effects of wind turbines on house prices using real estate price data from Germany's leading online broker. Employing a hedonic price model whose specification is informed by machine learning techniques, our methodological approach provides insights into the sources of heterogeneity in treatment effects. We estimate an average treatment effect (ATE) of up to -7.1% for houses within a one-kilometer radius of a wind turbine, an effect that fades to zero at a distance of 8 to 9 km. Old houses and those in rural areas are affected the most, while home prices in urban areas are hardly affected. These results highlight that substantial local externalities are associated with wind power plants.

Keywords: Wind power; hedonic price model (search for similar items in EconPapers)
JEL-codes: Q21 D12 R31 (search for similar items in EconPapers)
Date: 2019
New Economics Papers: this item is included in nep-ene, nep-reg and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

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https://www.econstor.eu/bitstream/10419/203583/1/VfS-2019-pid-27741.pdf (application/pdf)

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Working Paper: Local cost for global benefit: The case of wind turbines (2018) Downloads
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