New Horizons in Regional Science series
Edited by Aura Reggiani and Peter Nijkamp
Chapter 17: An ex ante Evaluation of an Urban Project through Property Value Increases: A Hedonic Price Approach
Roberto Camagni and Roberta Capello 17.1 INTRODUCTION This chapter focuses on the economic assessment of a relevant urban infrastructure project using expected increases in land values as indicators of the potential benefits to the urban population. The project concerns the laying underground of part of the urban rail track in the city of Trento, situated in the Alps, in northeastern Italy, along the Brenner Corridor Verona–Innsbruck–Munich. In fact, the rail track represents a barrier inside the city in a North–South direction, generating a low-accessibility, low-quality urban land belt running between the rail track itself and a second North–South barrier represented by the river Adige (Figure 17.1). The recent land-use plan of the city, produced under the direction of the Catalan planner Joan Busquets, recommends laying the central part of the rail line underground, for a length of 2 km, in order to reunite the two parts of the city, create improved accessibility to the city centre (which developed in an eastward semicircle around the central station) and new urban amenities – a boulevard replacing the rails, new high-quality buildings and recreation facilities. The policy question regards the economic viability of the project in terms of cost–benefit balance for the local community, given the huge public investment requested. This chapter proposes an assessment of the general social benefits through the evaluation of the expected increase in land and real estate values. In fact, all the potential advantages of the project refer to elements that have a direct...
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