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Abstract
Climate change, the ‘boom and bust’ cycles of rivers, and altered water resource
management practice have caused significant changes in the spatial distribution of the risk of
flooding. Hedonic pricing studies, predominantly for the US, have assessed the spatial incidence
of risk and the associated implicit price of flooding risk. Using these implicit price estimates and
their associated standard errors, we perform a meta-analysis and find that houses located in the
100-year floodplain have a –0.3 to –0.8% lower price. The actual occurrence of a flooding event
or increased stringency in disclosure rules causes ex ante prices to differ from ex post prices, but
these effects are small. The marginal willingness to pay for reduced risk exposure has increased
over time, and it is slightly lower for areas with a higher per capita income. We show that
obfuscating amenity effects and risk exposure associated with proximity to water causes
systematic bias in the implicit price of flooding risk.