Working Paper: NBER ID: w16655
Authors: Shanti Gamper-Rabindran; Ralph Mastromonaco; Christopher Timmins
Abstract: We apply three complementary approaches designed to identify the localized effects of Superfund site remediation under the CERCLA, examining data at the level of (i) the census tract (paying attention to within tract heterogeneity), (ii) the census block, and (iii) individual house transaction. Our analysis of the within-tract housing value distribution detects statistically and economically significant appreciation in the lower tails resulting from hazardous waste cleanup; deletion of a site raises tract-level housing values by 18.2% at the 10th percentile, 15.4% at the median, and 11.4% at the 60th percentile. These tract results are confirmed by (i) house transaction data that show cheaper houses within each tract are more likely to be exposed to waste sites within one kilometer, explaining their greater appreciation from site cleanup, and (ii) high-resolution census block data that show greater appreciation among blocks lying closer to the cleaned sites. House-level repeat-sales data confirm results from our national level census analysis by showing that deletion raises housing values relative to proposal in specific markets, such as northern New Jersey, but they also uncover a great heterogeneity in the effects of remediation across markets, with no statistical effects from deletion relative to proposal detected in Los Angeles metro, southwestern Connecticut or Boston metro.
Keywords: Superfund; remediation; housing values; localized externalities
JEL Codes: Q5; Q51; Q53
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Completion of cleanup efforts (H84) | Perceived reduction in health risks and environmental hazards (Q52) |
| Deletion of a Superfund site from the National Priorities List (NPL) (Q53) | Appreciation of lower-value homes (R21) |
| Superfund remediation (Q52) | Influence on local housing markets (R31) |
| Superfund remediation (Q52) | Housing value appreciation (R31) |
| Deletion of a Superfund site from the National Priorities List (NPL) (Q53) | Increases in nearby housing values (R21) |