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Valuating the negative externality of wind turbines: traditional hedonic and difference-in-difference approaches
KTH, School of Architecture and the Built Environment (ABE), Urban Planning and Environment, Urban and Regional Studies.ORCID iD: 0000-0002-2080-6859
KTH, School of Architecture and the Built Environment (ABE), Real Estate and Construction Management, Real Estate Economics and Finance.ORCID iD: 0000-0002-9944-0510
(English)Manuscript (preprint) (Other academic)
Abstract [en]

Local negative externalities of an establishment of wind turbines have been documented in research; often with the help of the hedonic methodology and property values. We use mixed methods including hedonic methodology, propensity score matching, and the difference-in-difference approach to estimate causal effects, using almost 600,000 real estate transactions in Sweden from 2005 to 2018. The results indicate that we can reject the hypothesis that proximity to wind turbines does not impact property values, and this impact is relatively strong and varies over time and geographic region. Difference-in-difference with matching confirms estimates in the hedonic price equation studies. Furthermore, there is no indication of pre-event differences in house price outcomes based on distance from new wind turbines. Depending on the region, the total negative capitalisation amounts to between 10 and 25 percent within 0–2 kilometres from the wind power plant. We apply these estimates to the total housing stock in three different potential future development areas. Although effects per property are relatively marginal, the total effects of a wind farm establishment will be significant if they are located in densely populated areas.

Keywords [en]
wind turbine, capitalisation effect, regional, difference-in-difference, matching, property values
National Category
Economics and Business
Identifiers
URN: urn:nbn:se:kth:diva-314607OAI: oai:DiVA.org:kth-314607DiVA, id: diva2:1674034
Available from: 2022-06-21 Created: 2022-06-21 Last updated: 2022-06-25Bibliographically approved

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Westlund, HansWilhelmsson, Mats

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CiteExportLink to record
Permanent link

Direct link
Cite
Citation style
  • apa
  • ieee
  • modern-language-association-8th-edition
  • vancouver
  • Other style
More styles
Language
  • de-DE
  • en-GB
  • en-US
  • fi-FI
  • nn-NO
  • nn-NB
  • sv-SE
  • Other locale
More languages
Output format
  • html
  • text
  • asciidoc
  • rtf