A spatial difference-in-differences estimator to evaluate the effect of change in public mass transit systems on house prices

Authors: Dubé, Jean; Legros, Diègo; Thériault, MariusDes Rosiers, François
Abstract: Evaluating the impact of public mass transit systems on real-estate values is an important application of the hedonic price model (HPM). Recently, a mathematical transformation of this approach has been proposed to account for the potential omission of latent spatial variables that may overestimate the impact of accessibility to mass transit systems on values. The development of a Difference-in-Differences (DID) estimator, based on the repeatsales approach, is a move in the right direction. However, such an estimator neglects the possibility that specification of the price equation may follow a spatial autoregressive process with respect to the dependent variable. The objective of this paper is to propose a spatial Difference-in-Differences (SDID) estimator accounting for possible spatial spillover effects. Particular emphasis is placed on the development of a suitable weights matrix accounting for spatial links between observations. Finally, an empirical application of the SDID estimator based on the development of a new commuter rail transit system for the suburban agglomeration of Montréal (Canada) is presented and compared to the usual DID estimator.
Document Type: Article de recherche
Issue Date: 12 April 2014
Open Access Date: Restricted access
Document version: VoR
Permalink: http://hdl.handle.net/20.500.11794/2928
This document was published in: Transportation Research Part B, Vol. 64, 24–40 (2014)
Alternative version: 10.1016/j.trb.2014.02.007
Collection:Articles publiés dans des revues avec comité de lecture

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