The impact of Tsunamis on land appraisals: Evidence from Western Japan

Abstract

This paper estimates the impact of the tsunami caused by the Great East Japan earthquake on land appraisals of various locations outside of directly damaged areas. The focus is on locations that are expected to be extensively damaged by a tsunami if the Nankai Trough earthquake occurs. We use the DID and DDD approaches and show that locations with low elevation and close to the sea experienced decreases in appraised land prices compared to locations with high elevation and far from the sea. Especially, locations with less than 3.6m elevation and within 1.46km of the coastline experienced significant decreases in appraised land prices. This result implies that people have changed their location preferences regarding elevation and distance from the sea.