Valuation of Wetland Restoration: Evidence from the Housing Market in Arkansas

This paper investigates the impact of the Wetland Reserve Program utilizing the residential housing and wetland easement data to estimate the benefit of wetland restoration in Arkansas. The environmental benefits of alternative agricultural management practices are underestimated and largely ignored by agriculture producers and beneficiaries. Governments at various levels have developed programs to provide appropriate economic incentives to optimize agricultural production and environmental benefits. Based on a quasi-experimental approach and an event study design, our results indicated that there is a statistically significant increase in property values near the wetland restoration sites and the estimated increase ranges from 6% to 10%.