Industrial Risks and Housing Prices

Housing prices can decrease because of proximity to hazardous industrial plants. This effect depends on households’ perception of risk and can so be modified by events that change risk perception, such as technological risk prevention plans in France. The impact of these plans is difficult to estimate because their implementation in urban zones is very recent. However, the study of other events modifying risk perception provides partial answer. This paper studies areas in the vicinity of hazardous industrial plants near Bordeaux, Dunkirk and Rouen. Applying hedonic price method enables to estimate the effect of proximity to hazardous industrial plants on housing prices. Results suggest that these price differences are modified neither by local incidents, the AZF accident, information policies, nor by the implementation of the technological disasters insurance system. Keywords: environmental public policies, industrial risk, land use, hedonic price method. JEL classification: Q51, Q58, R52.