Loma Prieta Earthquake: An Event Study of Changes in Risk Perceptions and the Housing Market.

摘要

The study assessed the housing market impact of the 1989 Loma Prieta earthquake on the San Francisco Bay Area. The analysis was degigned to determine if risk, as measured by housing location influences such as soil type, is a significant determinant of housing prices and the magnitude of any hedonic price gradient. It focused on two potential impacts: (1) risk perceptions of area residents, as seen by subjective perceptions obtained from household surveys (hedonic price function estimation); and (2) a survey of actual housing transactions. The findings suggested that the earthquake and location indicators such as social type and special studies zone (SSZ) location significantly affected home prices and that the earthquake's negative impact dissipated within six months. Findings of the former hedonic price method were consistent with the actual sales data, implying that home owners accuratelyassess house price determinants and price changes due to exogenous events. Policy recommendations were (1) that there is a perceptible market premium for additional safety; (2) that public policy encouraging relation could entail significant costs; and (3) that a public information campaign on SSZ's is needed.