| The hemlock woolly adelgid (HWA) is an exotic insect pest that has been causing mortality to eastern and Carolina hemlocks. HWA is currently established in 15 eastern states and is spreading to other states where these hemlock species are found. Hemlocks are widely used as ornamental trees in residential landscapes, but to date, the economic impact of the spread of the HWA on private residential property values has not been quantified. As the hemlock is valued both for its aesthetic beauty and screening purposes, it is hypothesized that hemlock health on an individual's private property will affect that home's value.; This research examines the economic impact of HWA on residential landscapes by employing a hedonic property value model. Two study sites in Northwestern New Jersey were chosen as the HWA has already had a significant impact in this area. In addition to structural housing characteristics, environmental variables used in the model include measures of hemlock health, land cover types, proximity to natural areas and the presence of water bodies. For this study, Landsat satellite imagery was used to measure hemlock health on a landscape scale over time.; The analysis spans multiple spatial scales in order to examine both immediate parcel level and larger scale neighborhood effects of hemlock health on the value of homes. Spatial econometric techniques were employed to correct for the spatial dependence found in the data. A semi-log functional form was used as the final specification. In the first study area, the results showed healthy hemlocks had a positive effect on property values at all spatial scales, while moderately defoliated hemlocks had a negative impact on housing prices. In the second study area, healthy hemlocks contributed positively to housing prices, but only in the larger spatial scales, while dead hemlocks were found to be negative, but only significant at the parcel level.; By combining the work of landscape ecologists and environmental economists, this innovative study extends the application of satellite imagery data in examining natural resource management issues. This assessment will also be useful to forest managers concerned with resource allocation decisions in forest pest management. |
