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Environmental Law

Vanderbilt University Law School

Cancer

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The Market Value Of Reducing Cancer Risk: Hedonic Housing Prices With Changing Information, W. Kip Viscusi, Ted Gayer, James T. Hamilton Jan 2002

The Market Value Of Reducing Cancer Risk: Hedonic Housing Prices With Changing Information, W. Kip Viscusi, Ted Gayer, James T. Hamilton

Vanderbilt Law School Faculty Publications

In this paper, we use housing price changes occurring after the release of a regulatory agency's environmental risk information to estimate the value people place on cancer risk reduction. Using a large original data set on the repeat sales of houses, matched with detailed data on hazardous waste cancer risk and newspaper publicity, we find that housing prices respond in a rational manner to changes in information about risk. Since the new information indicated that the sites in our sample pose relatively low cancer risk, the informational release led residents to lower their risk beliefs, resulting in an average ...