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Abstract This study estimates the marginal values of housing attributes in residential location choice and compares the implicit prices of the housing attributes between income groups using a stated preference experiment. The implicit prices of amenity-related attributes for the higher income groups are estimated as 9 to 22 times higher than those for the lower income groups, while the implicit prices of access/space-related attributes for the higher income groups are 4 to 5 times higher than those for the lower income group. This result shows that the relative importance of amenities in residential location choice become more significant over income. This study also finds that willingness-to-pay for the intangible values including residential amenities is more than 50% of the total willingness-to-pay for the one level improvement of the current housing in the higher income group, but 35.6% in the middle income group and 27.4% in the lower income group. The empirical result in this study implies that monopolistic rent tends to be formulated through excessively substantial amenity values by the higher income group living in some confined residential areas. This study also implicitly shows that the metropolitan housing market is not a single equilibrium market, but is composed of the various submarkets over social stratification
Jae Hong Kim (Sat,) studied this question.