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Valuation of Urban Environmental Amenities: A Case Study

Vijaya Gupta, G. Mythili


The main objective of this study is to value the urban environmental amenities in Mumbai through property (real estate) prices. The areas chosen for the study are central, north and Navi Mumbai. Primary cross-sectional data collected during July-November 2006 from 578 new house owners from different locations in Mumbai were used. Physical and visual access to water body, greenery, noise and slums are the various environmental attributes considered. Hedonic price function is utilised to capture the impact of environmental, locational and structural attributes on the price per square foot (PSF), prevalent in Mumbai. Specification test revealed log-linear form as the best fit. The results indicate that ‘Proximity to water body’ fetches the highest, 18.9 % of the total value, in Navi Mumbai, and garden proximity fetches the highest, 13.2%, in Central suburb. It was found that preference to noise free location fetches the most value in Central Suburb and least in Northern Suburb. It is also observed that all the environmental attributes receive highest absolute values in Central Suburb reflecting high scarcity of environmental quality in the area.


Hedonic pricing, environmental amenities, marginal value, Mumbai

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