Estimating the Willingness to Pay for Undergrounding Utility Lines in Japan with the Hedonic Approach

Abstract

This paper calculates the willingness to pay (WTP) of residents for undergrounding utility lines with the hedonic approach. Land price functions are estimated for seven regions in Japan. Estimation is conducted for densely inhabited districts (DIDs), non-DIDs, and the whole region. The estimates confirm positive WTP of a household facing a road with undergrounded utility lines (approximately 5,000 to 9,000 JPY per month) and a household in the neighborhood not facing the road (approximately 3,500 to 7,000 JPY per month), depending on the region and the specified functional form. Further, results indicate that the order of WTP in DID and non-DID differs across regions.