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The Value of Open Space in Tennessee


NRPC Leads:
Seong-Hoon Cho and Donald G. Hodges

Outside Researcher: Roland K. Roberts

Research Assistant: Seung Gyu Kim

Funding Source: The Nature Conservancy

Project Description
The overall purpose of this analysis is to provide a factual basis for informing legislators, the public and conservation organizations about the value of open space to Tennessee. There are a number of approaches that can be taken to the valuation of open space. The following should be investigated as part of this report for Tennessee.

Enhancement of Property Values in Proximity to Open Space

  • Measuring the difference in selling prices for property at varying distances from open space gives a surrogate value for the open space itself. It provides a measure of the effects of open space on the economy, to the extent that the enhanced values are translated into higher property values. Higher values increase property tax revenues. Property values provide a useful localized measure of open space values. There are also many other economic effects of open space such as recreation and community-wide aesthetic values that are not reflected in individual property values.

Value of Time and Goods used in Relation to Open Space

  • Open space is used for a variety of activities, some of which are incorporated in the market economy. Those goods and services provided by open space, such as agricultural and forest production, can be valued by the market price of the goods produced. Similarly, the price paid for access to open space where fees are charged for recreational use can also be used.

Cost Benefit Analysis of Developing Versus Protecting Open Space

  • Cost benefit analysis is a comprehensive approach to decision making based on comparing the economic costs and benefits of specific courses of action. The costs and benefits are specified in dollar terms and the ratio of benefits to costs is determined over the lifetime of the action. It is most commonly used to determine if the benefits exceed the costs for a specific action such as building a dam or in this case a new park. A comprehensive cost benefit analysis for open space would take into consideration all costs including externalities, such as pollution, and loss of wildlife and open space.
Project Links

Seong-Hoon Cho
University of Tennessee
Agricultural Economics
scho9@utk.edu
Donald G. Hodges
University of Tennessee
Forestry, Wildlife & Fisheries
dhodges2@utk.edu
The Nature Conservancy

Copyright © 2007
~To enhance policy making relative to the sustainable management
of natural resources in Tennessee and the Southeastern Region~
The University of Tennessee