1. The Value of Wetlands Versus Open Water in Louisiana
Walter R. Keithly, Jr.
Baifu Xu
John Barras
Richard F. Kazmierczak, Jr.

2. Land Loss of Coastal Louisiana
“America’s Wetlands”, about 30% of the Lower 48 states’ coastal wetland;
20% of wetlands lost in the past 100 years;
Catastrophic loss rate: square miles a year;
90% of the continental US coastal marsh loss;
Hurricane Katrina caused southeastern Louisiana over $90 billion in physical losses and Hurricane Rita caused the southwest coastal area of Louisiana over $5 billion, and unexpected wetland loss.

4. Wetlands Restoration Measures
129 federal and state restoration projects;
Less than 10% of the minimum funding needed for restoration;
80 percent of all coastal Louisiana wetlands are privately owned.

5. Objectives
To identify the factors influencing the value of coastal wetland properties in southwestern Louisiana;
To examine the influence of open water and wetland types on private market property values;
To estimate implicit prices associated with underlying wetland characteristics.

6. Steps for Hedonic Model
Gather property transfers and price;
Collect explanatory variables;
Property characteristics (e.g., wetland type)
Structural characteristics (e.g., acreage, distance from coast)
Establish the relationship between price and explanatory variables.

7. Study Area

8. How Did We Digitalize a Privately Owned Property?
Bill of Sales (Transfers);
Township Map: locate township, range, and section;
Scanned Topographic Maps;
Draw property polygons using ArcGIS.

10. Example of One Individual Property

11. Property Polygons - Digitalizing

12. Symbols and Descriptive Statistics
Mean
Minimum
Maximum
Std. Dev
PRICE2K $
284004
12858
524137
P2KPACRE
570.89
51.05
495.13
ACRES
933.93
36.21
OPEN WATER %
20.24
87.41
21.30
FRESH %
10.81
99.89
25.39
INTER %
26.49
98.97
34.94
BS %
15.88
98.00
30.99
OTHER %
25.97
36.84
INTEREST
0.957
0.03 1
0.176

13. General Hedonic Model

14. Specific Model
Ln(Price/acre)=

15. Hedonic Price Function R2: 0.7110, Adjusted R2: 0.6763

16. Discussion/Key Findings
An increase of fresh marshes relative to open water enhances the price per acre, ceteris paribus;
An increase in intermediate marsh and/or brackish & saline marsh relative to open water decreases the price per acre, ceteris paribus;
Other significant positive influences include: interest in property and year;
Other significant negative influences include: total acres and higher expected erosion rate;

17. Thanks!