The Monetary Valuation of Environmental Externalities through the Analysis of Real Estate Prices

• Main Authors: Vincenzo Del Giudice, Pierfrancesco De Paola, Benedetto Manganelli, Fabiana Forte
• Format: Article
• Language: English
• Published: MDPI AG 2017-02-01
• Series: Sustainability
• Subjects: environmental externalities; real estate market; econometric models; evaluation under risk and uncertainty; noise pollution
• Online Access: http://www.mdpi.com/2071-1050/9/2/229

This paper proposes a theoretical model of evaluation of environmental externalities based on the analysis of real estate prices. This issue is included in regional planning policies which include activities and interventions that produce economic and non-economic effects. The monetary assessment of economic and non-economic effects can be expressed as a forecast (ex ante) and/or following (ex post) such activities and interventions. The assessment of the economic impact, with particular reference to interventions and infrastructure work, is widely based on procedures which make use of market prices. The proposed model was applied to an actual case, considering the effects of noise pollution, produced by traffic from the Naples Beltway, on residential property.