An Extension of the Hedonic Approach for Estimating the Value of Quiet

There is no explicit market through which environmental amenities can be evaluated, because of their public-good nature. A popular but controversial method has been to relate the degree of environmental amenity to property value. Typical of that approach is the Ridker and Henning utilization of hedonic regression technique relating, for census tracts in St. Louis, average home values to home and neighborhood characteristics including air sulfation levels to determine an implicit price for pollution-free air. The approach presented seeks to determine households' true willingness to pay for environmental amenities from the information afforded by the hedonic regression itself, in the absence of further information about households. The results of a regression are reported in which the price of an environmental attribute, quiet (freedom from aircraft noise), is estimated. It is illustrated how, on the basis of assumptions common in demand studies, these results can be used to estimate the willingness to pay for aircraft noise abatement.