To the water's edge, and beyond: Effects of shore protection projects on beach development

The effects on real estate development of shore-protection efforts that low er erosion rates and storm hazards are both controversial and difficult to detect. A simple theoretical model indicates that shore protection is likel y to "tilt" development from areas a few hundred feet inland toward beachfr ont property. A modified repeat-sale house price index is used to measure p rice appreciation rates to the water's edge. We are able to formulate an ex tremely sensitive empirical test for a tilt in rates of house-price appreci ation implied by a tilt in development. Surprisingly, we find no significan t evidence that shore-protection efforts have produced additional beachfron t development in the Florida counties studied. The method used in this arti cle is quite general and could be used in a number of applications where an environmental effect impacts real estate differentially over space.