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Hedonic pricing in Windhoek townships
Umeå University, Faculty of Social Sciences, Department of Economics.
Umeå University, Faculty of Social Sciences, Umeå School of Business and Economics (USBE), Economics.
2003 (English)In: Environment and Development Economics, ISSN 1355-770X, E-ISSN 1469-4395, Vol. 8, no 2, 391-404 p.Article in journal (Refereed) Published
Abstract [en]

This study applies the hedonic pricing model to property sales in the township areas in Windhoek, the capital city of Namibia, where municipal authorities have pursued a programme of selling plots of land to settlers in order to encourage them into a formalized economic situation. We find that, apart from house quality, access to the central business district, access to marketplaces and access to transportation, environmental quality also has a large impact on property prices. Properties located close to a garbage dump sell at considerable discounts, while properties located close to a combined conservation and recreation area sell at premium prices. The results thus suggest that the hedonic pricing method can be useful for studying townships in developing countries, and that this can help to clarify the importance of environmental factors which are otherwise frequently neglected in town planning for township settlements.

Place, publisher, year, edition, pages
2003. Vol. 8, no 2, 391-404 p.
National Category
Economics
Identifiers
URN: urn:nbn:se:umu:diva-2434DOI: 10.1017/S1355770X0300202OAI: oai:DiVA.org:umu-2434DiVA: diva2:140426
Available from: 2007-06-01 Created: 2007-06-01 Last updated: 2017-12-14Bibliographically approved
In thesis
1. Essays on public finance and environmental economics in Namibia
Open this publication in new window or tab >>Essays on public finance and environmental economics in Namibia
2007 (English)Licentiate thesis, comprehensive summary (Other academic)
Abstract [en]

This thesis comprises two papers exploring aspects of public finance and environmental economics in Namibia.

Paper [I] estimates the shadow prices of capital, labour and foreign exchange for the Namibian economy. The results suggest that the shadow price of capital for Namibia is 8%. The economic costs of Namibian labour, as a share of financial costs, are 32% for urban semi- and unskilled labour, and 54% for rural semi- and unskilled labour. The economic cost of foreign labour as a share of financial costs is 59%. The estimated range for the shadow exchange rate factor is between 7% and 14% for the Namibian economy.

Paper [II] studies the determinants of property prices in the township areas of Windhoek, the capital of Namibia. The study reveals that properties located close to an environmental hazard, such as a garbage dump, sell at considerable discounts. On the other hand properties located near an environmentally favourable location, such as recreational open space, sell at a premium. These results provide evidence of the importance of environmental quality in lower income property markets in developing countries. It is therefore important for Namibian urban planners to incorporate environmental quality within the planning framework for lower income areas.

Place, publisher, year, edition, pages
Umeå: Nationalekonomi, 2007. 70 p.
Series
Umeå economic studies, ISSN 0348-1018 ; 705
Keyword
Namibia, Project Evaluation, Cost-benefit analysis, Hedonic pricing, Townships
National Category
Economics
Research subject
Economics
Identifiers
urn:nbn:se:umu:diva-1163 (URN)978-91-7264-313-0 (ISBN)
Presentation
2007-05-31, Umeå, 10:15
Supervisors
Available from: 2007-06-01 Created: 2007-06-01Bibliographically approved
2. Mixing Oil and Water: Studies of the Namibian Economy
Open this publication in new window or tab >>Mixing Oil and Water: Studies of the Namibian Economy
2003 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

This thesis consists of four papers studying economic aspects of natural resource and environmental management in Namibia.

Paper [I] analyses changes in Namibian energy use patterns between 1980 and 1998. The study finds that, unlike their counterparts in many other developing countries where energy use has been studied, Namibian energy users appear to have been quite flexible in changing to energy-saving technologies and to technologies using different energy sources altogether. One explanation for this difference may be that Namibia has had relatively high energy prices and has had high taxes on oil-based fuels, which may have made Namibian energy users more interested in potential energy savings.

Paper [II] studies variables affecting property pricing in the township areas of Windhoek, Namibia’s capital city. Plots close to a garbage dump sell at substantial discounts, while plots close to a recreation area sell at premium prices. These results suggest that environmental quality may be more important for households in township areas than has previously been believed. Neglecting issues of environmental quality in town planning for township areas may thus be a serious omission.

Paper [III] uses Namibian farm price data to study the impact of groundwater access on farm profitability. Potentially, groundwater can function both as an extra source of water in areas with low rainfall and as a buffer source of water in areas where rainfall is higher but variable. If groundwater mainly functions as a buffer source of water in high-rainfall areas, it could be replaced by various means of water storage fairly easily. Providing extra water by other means in low-rainfall areas, on the other hand, is likely to be prohibitively expensive. The study does not provide clear-cut results, suggesting that on precautionary principles one should assume that groundwater will be difficult to replace with other water sources.

Paper [IV] studies optimal allocation between commercial and recreational fishing for one of Namibia’s fish species, the kob. The biological dynamics of the kob are modelled using an age-class model with age-specific mortalities, in order to capture the fact that the two fisheries target different age classes. The length of the planning horizon is crucial for the results: If a short planning horizon is used, the results indicate that a large share of the catches should be allocated to commercial fishing. With a longer planning horizon, however, the higher profitability of recreational angling leads to the conclusion that it would be preferable to limit commercial fishing in order to permit kob stocks to recover and improve angling success.

Publisher
126 p.
Series
Umeå economic studies, ISSN 0348-1018 ; 611
Keyword
Economics, Namibia, energy use, structural decomposition analysis, hedonic pricing, townships, groundwater use, fisheries, bioeconomic modelling, Nationalekonomi
National Category
Economics
Research subject
Economics
Identifiers
urn:nbn:se:umu:diva-117 (URN)91-7305-508-5 (ISBN)
Public defence
2003-10-03, Hörsal F, Humanisthuset, Umeå, 10:15
Opponent
Supervisors
Available from: 2003-10-09 Created: 2003-10-09 Last updated: 2012-06-01Bibliographically approved
3. Essays on the Namibian Economy
Open this publication in new window or tab >>Essays on the Namibian Economy
2008 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

This thesis consists of an introduction and four papers exploring various aspects of the Namibian economy. These aspects cover shadow pricing, environmental valuation and capital market development in Namibia.

Paper I estimates the shadow prices of capital, labour and foreign exchange for the Namibian economy. The results suggest that the shadow price of capital for Namibia is 7.2%. The economic costs of Namibian labour, as a share of financial costs, are 32% for urban semi- and unskilled labour, and 54% for rural semi- and unskilled labour. The economic cost of foreign labour as a share of financial costs is 59%. The estimated shadow exchange rate factor is 4% for the Namibian economy.

Paper II derives a set of accounting price ratios (APRs) for the various economic sectors of Namibia by using the Semi-Input–Output (SIO) Technique. An APR is the ratio between the market or financial price and the efficiency or economic value of a specific commodity or sector, which is useful for the economic analysis of investment or development initiatives. This larger set of APRs, derived on the basis of information contained in a Namibian Social Accounting Matrix (SAM), should be useful in improving the effective appraisal of development projects and other major investment programmes in Namibia.

Paper III analyses returns and volatility on the Namibian and South African stock markets, using the daily closing indices of the Namibian Stock Exchange (NSX) and the Johannesburg Stock Exchange (JSE). The sample covers the period from 4 January 1999 to 20 March 2003. The methodology has three main parts: (i) unit root tests, (ii) cointegration analysis, and (iii) volatility modelling. The results show that the two markets exhibit very low correlations, and there is no evidence of a linear relationship between the markets. Furthermore, a volatility analysis shows evidence of no spillover effects. These results suggest that the NSX could be an attractive risk diversification tool for regional portfolio diversification in southern Africa

Paper IV studies the determinants of property prices in the township areas of Windhoek, the capital of Namibia. The work‟s major finding is that properties located close to an environmental bad (e.g. garbage dump) sell at considerable discounts. On the other hand, properties located near an environmental good (e.g. a recreational open space) sell at a premium. These results provide evidence of the importance of environmental quality in lower-income property markets in developing countries. It is important, therefore, for Namibian urban planners to incorporate environmental quality into the planning framework for lower-income areas.

Place, publisher, year, edition, pages
Umeå: Nationalekonomi, 2008. 156 p.
Series
Umeå economic studies, ISSN 0348-1018 ; UES 745
Keyword
Namibia; shadow prices; discount rate; semi-input-output; accounting price ratios; financial returns; volatility; hedonic pricing; townships
National Category
Economics
Identifiers
urn:nbn:se:umu:diva-1815 (URN)978-91-7264-633-9 (ISBN)
Public defence
2008-09-30, Hörsal D, Samhällsvetarhuset, Umeå, 10:15
Opponent
Supervisors
Available from: 2008-09-09 Created: 2008-09-09 Last updated: 2012-06-01Bibliographically approved

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