What is it about?
Estimating non marketable benefits from air quality improvements is important for designing policies to reduce air pollution in urban areas. We used the housing market to calculate a demand function for air quality in Bogota, Colombia. Policy makers may use the estimated non-marketable benefits from air quality improvements in Cost-Benefit analysis of pollution abatement policies. We proposed an strategy of market segmentation for the identification of the demand for air quality. The proposed method could be easily implemented in any urban area.
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Why is it important?
To our knowledge, this is the first study using housing sub-markets in the context of an emergent economy to identify a demand function for air quality. We highlighted the importance of spatial information to calculate benefits arising from air quality improvements.
Perspectives
Writing this article with a co-author was a great pleasure. We explored advance econometric techniques in this research to develop revealed preference methods used in non-market valuation. Urban air pollution has been in the public policy agenda and we found a great opportunity to apply comprehensively a non market valuation method to a real urban problem. It was fascinating to see what was accomplished when sharing and discussing results to policy makers involved in pollution reduction programs: we found that valuing environmental goods is a key step to communicate with policy makers. I hope you find this article as a useful and rewarding addition to the non market valuation literature.
Fernando Carriazo
Universidad Del Rosario
Read the Original
This page is a summary of: The demand for Air quality: evidence from the housing market in Bogotá, Colombia, Environment and Development Economics, February 2018, Cambridge University Press,
DOI: 10.1017/s1355770x18000050.
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