Externality impacts of “Not in My Backyard” facilities on property values: Evidence from the Hangzhou waste sorting and reduction complex projects

Abstract

Addressing the "Not in My Backyard" (NIMBY) claims as an issue in sustainable urban management. A common challenge is to determine how residents evaluate the attributes of NIMBY facilities and what factors could influence their evaluations. Using the Waste Sorting and Reduction Complex (WSRC) Projects in Hangzhou, China as a case study, this study develops hedonic price models to assess the externality impacts of the projects on property values in the planning phase and finds that WSRCs depress property values. More available public information changed the way residents evaluate the scale and environmental investments of WSRCs. We find that the landscapes have interactive effects on the externalities of WSRCs, as evidenced by the fact that the proximity to Xixi Wetland and parks reduces the negative impact of WSRCs on property values to a certain extent. We also analyze local effects by employing the geographically weighted regression model, showing that externality effects of WSRCs are heterogeneous in urban space. Findings provide a vital reference for local authorities to take residents' preferences into account in planning decisions and adopt compensation initiatives to address NIMBY issues.