Hedonic prices and cost/benefit analysis
type: Item
instance of: scholarly article
title: Hedonic prices and cost/benefit analysis
zbMATH Open document ID: 0568.90012
DOI: 10.1016/0022-0531(85)90030-4
author: Suzanne Scotchmer
published in: Journal of Economic Theory
publication date: 1985-01-01T00:00:00Z
review text: Hedonic prices have been used to evaluate the willingness to pay for attributes. We reformulate the notion of hedonic price from a composite price on housing to a unit price on traded quantities, in conformity with long run competitive equilibrium theory. This formulation was suggested (but not developed) by \textit{S. Rosen} [J. Polit. Econ. 82, 34-55 (1974)]. By first characterizing an efficient allocation of consumers to space, we show that hedonic unit prices can be understood as a bid-rent function which supports the efficient allocation. This is despite the fact that the lots over which consumers bid are themselves endogenous. We show that unit hedonic prices reveal preferences in a manner different from composite hedonic expenditures.
Mathematics Subject Classification ID: 91B50
Mathematics Subject Classification ID: 91B24
zbMATH DE Number: 3908111
zbMATH Keywords: cost/benefit analysis
zbMATH Keywords: Hedonic prices
zbMATH Keywords: long run competitive equilibrium
zbMATH Keywords: efficient allocation
MaRDI profile type: Publication
full work available at URL: 0022-0531(85)90030-4
OpenAlex ID: W2011370499
cites work: Q4070950
cites work: On the Estimation of Structural Hedonic Price Models
cites work: Competitive equilibrium with local public goods
cites work: Hedonic housing prices and the demand for clean air
cites work: The long-run effects of a residential property tax and local public services
cites work: General equilibrium and location theory
description: scientific article; zbMATH DE number 3908111