Willingness to pay for clean air: Evidence from diesel vehicle registration restrictions in Japan
Date
2021-02-17
Authors
Nishitateno, Shuhei
Burke, Paul
Journal Title
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Volume Title
Publisher
Elsevier
Abstract
This paper documents the effect of diesel vehicle registration restrictions introduced in Japan in 2001 in reducing suspended particulate matter (SPM) concentrations. The focus is on Aichi and Mie prefectures, home to a number of municipalities that were required to implement these restrictions in 2001. The paper then uses this intervention to estimate the causal effect of air pollution on land values. We obtain estimates of the elasticity of residential land prices with respect to SPM concentration of between –0.4 and –1.0. The revealed willingness to pay for the improvements in air quality induced by the intervention in Aichi and Mie is estimated at about US$7 billion. We also find evidence that net in-migration appears to be a key mechanism via which clean air was capitalized into higher land values. The results are robust to a number of estimation approaches and sample restrictions.
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Keywords
vehicle registration restrictions, urban air pollution, hedonic pricing
Citation
Nishitateno, Shuhei and Burke, Paul J. 2021. Willingness to pay for clean air: Evidence from diesel vehicle registration restrictions in Japan. Regional Science and Urban Economics 88, 103657.
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Source
Regional Science and Urban Economics
Type
Journal article
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Access Statement
Open Access
License Rights
CC BY-NC-ND
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