An empirical investigation into the performance of Ellickson's random bidding model, with an application to air quality valuation

Article Abstract:

A random bidding model formulated by B. Ellickson is compared to a previously proposed standard hedonic model to ascertain benefits resulting from marginal and non-marginal willingness-to-pay (WTP) changes in housing attributes by household type in the residential market of the Chicago Primary Metropolitan Statistical Area including Cook and DuPage counties. Both models are based on the hypothesis of utility maximization. Results indicate that WTP estimates derived from both models are quite close. The random bidding model is a better model to use to derive benefits associated with various sections of the population characterized by socio-economic attributes, with the effect of categorization on benefit estimates as a whole being negligible.

Research, Evaluation, Econometrics, Metropolitan areas, Air quality, Model theory, Purchasing power

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An analysis of the supply of housing characteristics by builders within the Rosen framework

Article Abstract:

Analysis of single-family housing should not be limited to demand relationships. The supply aspect, which show cost variables among firms, needs to be given significant consideration. A study of supply relationships based on the Rosen framework poses problems of data bias and simultaneity, which lead to inconsistent estimates. These problems can be addressed by using single market data from various time frames and referring to a local realtor's multiple listing service for reliable and objective housing information. Estimation processes show an inverse relationship between housing quantity and price. Various specifications also show cost and related differences between builders.

Supply and demand, Housing, Single family housing, Housing, Single family

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