Abstract
Rehabilitating the good ecological status of rivers in urban catchments can represent a wise decision since it can enhance the provision of valuable ecosystem services, such as aesthetic appreciation. The higher prices of houses located closer to rivers are a reflection of the willingness of households to pay for access to such service. The main objective of this study was to apply a hedonic pricing analysis to estimate the benefits generated by this ecosystem service due to the rehabilitation of the Yarqon River in Israel. During the last two decades, several projects and actions, such as the discharge of tertiary-quality effluents, have increased the quantity and quality of the river's water and improved its ecological state. Using a sample of 883 houses in the Tel-Aviv Metropolitan Area and selecting a mixed log-level functional form (R2 = 0.808), it was found that an increase of 1% in the distance to the Yarqon caused a 0.12% decrease in the price of a house. Finally, benefits are estimated and compared with the rehabilitation costs, showing that, even if no other ecosystem services are considered, the rehabilitation can prove to be beneficial to society.
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