MEASURING THE IMPACT OF THE DISCOVERY AND CLEANING OF IDENTIFIED HAZARDOUS-WASTE SITES ON HOUSE VALUES

The current ranking system for Superfund sites considers only the costs of physically cleaning the site, ignoring the social benefits obtained by cleaning. This study estimates the effect of the existence of toxic sites on house values from before information on their toxicity was released by the federal government until several years after cleaning strategies were announced. The results indicate that community knowledge of the site, as well as government agency announcements, causes house prices to decline. It does not appear that assurances that the sites will be cleaned in the future lead to a rebound in house prices. (JEL R14, Q20)