THE IMPACT OF TOXIC-WASTE SITES ON HOUSING VALUES

This paper analyzes the impact of the Environmental Protection Agency (EPA) announcements and policy actions on housing markets. When the EPA announces that a toxic waste site is on the Superfund list, the findings of this paper show that a new market for "safe" housing is created. A premium to be located farther from a waste site appears only after a site has been added to the Superfund list. Empirical analysis of the housing market calculates the marginal prices in this new market, and importantly, show that the marginal price to avoid a toxic waste site disappears after a site has been cleaned. © 1991.