EUKN - European Urban Knowledge Network - Willingness to pay for parks and public gardens increases with income

Willingness to pay for parks and public gardens increases with income

Introduction

Research conducted by the 'Netherlands Bureau for Economic Policy Analysis' (CPB) shows that the willingness to pay for parks and public gardens increases with income. This conclusion was reached on the basis of a study into the costs and benefits of public space. However, when incomes rise, many households prefer to spend the extra money on a larger home first. Apart from that, it appears that having a private garden leads to an increasing demand for public green space. This means that public and private green space are complementary. The study looked at three different cities in The Netherlands: Rotterdam, The Hague and Amsterdam. Even though these cities are relatively close to each other, they show some interesting differences in the demand for public space.

Proposition

What are the costs and benefits of public green space for individuals?

Description

Although many researchers have investigated the value of open space in cities, few of them have compared them to the costs of providing this amenity. In this paper, the authors use the monocentric model of a city to derive a simple cost-benefit rule for the optimal provision of open space. The rule is essentially the Samuelson-condition for the optimal provision of a public good, with the price of land as the appropriate indicator for its cost. The condition is made operational by computing the willingness to pay for public and private space on the basis of empirical hedonic price functions for three Dutch cities. The conclusions with respect to the optimal provision of open space differ between the three cities. Further investigation reveals that willingness to pay for parks and public gardens increases with income, although not as fast as that for private residential space.

Conclusions

The willingness to pay for parks and public gardens increases with income;
Of the three cities researched, people in Amsterdam are the least willing to pay for public green space;
People in Amsterdam do however attach a lot of value to public space;
Most public green space is availabe in The Hague.

Contact info

Netherlands Bureau for Economic Policy Analysis
PO Box 80510
2508 GM The Hague
The Netherlands
Phone: +31-70-3383380
Fax: +31-70-3383350
info@cpb.nl
Willemijn van der Straaten (researcher)

Publication date

/01/2008

Researcher

Willemijn van der Straaten & Jan Rouwendal

Article info
ISBN: 9789058333506

Click here to download the report 'The costs and benefits of providing open space in cities' (PDF, Eng, 321 kB)

Document type

research

Themes

Urban Policy > Transport and infrastructure > Services & amenities

Keywords

Public space