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(1) Daniels (1997) takes a critical view of the use of clustering
for preserving farmland on the urban fringe, arguing that it may be
incompatible with an agricultural economy.
(2) The term "conservation" subdivision usually implies
something broader than clustering. See Mohammed (2006) for a description
of a conservation subdivision.
(3) The time periods are chosen to reflect zoning and other changes
in the county.
(4) We tested a number of different specifications, including a
subdivision fixed effects model. While that specification has the
advantage of controlling for all unobserved subdivision characteristics,
it prevents us from estimating effects of specific subdivision level
variables, including the total amount of subdivision open space.
Coefficients on house-specific variables are very similar to the results
with block group fixed effects.
(5) The Moran I statistic is found to be 11.570.
(6) Letting u denote the vector of error terms, [u.sub.i], i = 1 to
N, in our model, we assume [u.sub.i] = [rho][W.sub.i]u +
[[epsilon].sub.i], where [rho] is the spatial autocorrelation parameter
to be estimated, [W.sub.i] is the ith row of the weighting matrix, W,
and [[epsilon].sub.i] is the component of the error term made up of
independently and identically distributed (iid) random variables. The
weighting matrix, W, selects the "neighbors" so that W =
{[w.sub.ij]}, where [w.sub.ij] = 1/[n.sub.i] (where [n.sub.i] = number
of "neighbors" of house i) if i and j are within the same or
adjacent subdivisions; because a subdivision is not viewed as its own
neighbor, [w.sub.ii] = 0 for all i.
(7) With the one mile weighting scheme, the Moran I test statistic
is 12.895.
(8) Our steepness variable cannot measure the slope of the open
space adjacent to particular houses, but the more open space in the
subdivision in steep slopes, the higher the probability that any house
adjacent to open space will be adjacent to steep open space.
(9) Adjacency to another subdivision's open space becomes
significant at the 10% level if subdivision fixed effects are included
in the model.
Elizabeth Kopits is Economist at the U.S. EPA National Center for
Environmental Economics. Virginia McConnell is Professor of Economics at
University of Maryland and Senior Fellow at Resources for the Future
(RFF). Margaret Walls is Senior Fellow at RFF.
The views expressed in this article are those of the authors and do
not necessarily represent those of the U.S. EPA. No official Agency
endorsement should be inferred. The helpful comments of Soren Anderson
are greatly appreciated.
This article was presented in a principal paper session at the AAEA
annual meeting (Portland, OR, July 2007). The articles in these sessions
are not subjected to the journal's standard refereeing process.
Table 1. Summary Statistics for House and Subdivision Data, Calvert
County, MD
Variable Mean SD
House variables (3,386
house sales)
House sale price (a) 221,749.30 74,000.48
Lot size (acres) 1.511 1.586
Sale year 1,994.422 5.087
Structural characteristics:
House size (square feet) 2,075.047 801.959
House age (years) 5.821 10.026
Dwelling grade (dummy) (b) 0.177 0.382
Number of full bathrooms 1.999 0.512
Number of half bathrooms 0.583 0.498
Fireplace (dummy) 0.618 0.486
Townhouse 0.008 0.091
Open space and surrounding land
uses (dummy variables):
Adjacent to subdivision
open space area 0.249 0.433
Adjacent to another
subdivision open space 0.024 0.153
Adjacent to preserved
farmland, parkland 0.014 0.118
Adjacent to undeveloped,
unpreserved land 0.142 0.351
Adjacent to water 0.016 0.126
Subdivision variables (89 subdivisions)
Size of subdivision (acres) 133.615 104.853
Size of subdivision open
space area (acres) 28.951 46.316
Pct.open space in steep
slopes (>15% slope) 0.373 0.347
Subdivision recording year 1,983.675 10.218
Accessibility/location:
Distance to the Northern
border (meters) 18,965.17 13,351.70
Access to Town Center
(gravity index) 10.732 83.375
Distance to Route 2/4
(meters) 2,419.191 1,799.510
RCD Rural zoning district
(dummy) 0.685 0.467
FCD Rural zoning district
(dummy) 0.079 0.271
Residential zoning district
(dummy) 0.213 0.412
Town Center (dummy) 0.022 0.149
Variable Range
House variables (3,386
house sales)
House sale price (a) 12,642-939,180
Lot size (acres) 0.034-30.41
Sale year 1,981-2,001
Structural characteristics:
House size (square feet) 576-6,575
House age (years) 0-186
Dwelling grade (dummy) (b) 0-1
Number of full bathrooms 1-5
Number of half bathrooms 0-2
Fireplace (dummy) 0-1
Townhouse 0-1
Open space and surrounding land
uses (dummy variables):
Adjacent to subdivision
open space area 0-1
Adjacent to another
subdivision open space 0-1
Adjacent to preserved
farmland, parkland 0-1
Adjacent to undeveloped,
unpreserved land 0-2
Adjacent to water 0-1
Subdivision variables (89 subdivisions)
Size of subdivision (acres) 16.61-589.59
Size of subdivision open
space area (acres) 0.250-295.130
Pct.open space in steep
slopes (>15% slope) 0-1
Subdivision recording year 1,928-1,999
Accessibility/location:
Distance to the Northern
border (meters) 955.72-49,912.3
Access to Town Center
(gravity index) 0-768.431
Distance to Route 2/4
(meters) 167.87-7,633.7
RCD Rural zoning district
(dummy) 0-1
FCD Rural zoning district
(dummy) 0-1
Residential zoning district
(dummy) 0-1
Town Center (dummy) 0-1
(a) Year 2000 dollars.
(b) Dwelling grade equals 1 if house is categorized as low to fair
quality, 0 otherwise.
Table 2. Results of the Spatial Error Model, with Block Group Fixed
Effects (Dependent Variable is the natural log of house sale price)
Variable Description Coefficient (t-Stat)
1 Own lot size (acres, logged) 0.078 *** (10.423)
Variables related to subdivision
open space
2 Subdivision open space
(acres, logged) 0.010 ** (2.279)
3 Percent of open space acres
in steep slopes -0.024 (-1.140)
4 Subdivision open space (var 2)
* pct steep (var 3) -0.003 (-0.410)
5 Subdivision open space (var 2)
* own lot size (var 1) -0.007 *** (-2.715)
6 Adjacent to own subdivision
open space (dummy) 0.029 ** (2.181)
7 Adjacent to own open space
(var 6) * pct steep (var 3) -0.059 ** (-2.327)
8 Adjacent to own open space
(var 6) * lot size (var 1) 0.016 (1.512)
Other adjacency variables
9 Adjacent to another subdivision's
open space area 0.010 (0.582)
10 Adjacent to water 0.300 *** (12.805)
11 Adjacent to undeveloped,
unpreserved land -0.006 (0.741)
12 Adjacent to preserved farmland
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