Mario Du Preez - Profile on Academia.edu (original) (raw)

Papers by Mario Du Preez

Studies in Economics and Econometrics, Aug 1, 2012

This paper presents an application of the conditional logit model to a small, Nelson Mandela Bay ... more This paper presents an application of the conditional logit model to a small, Nelson Mandela Bay neighbourhood housing data set, with the objective of determining the impact of proximity to a low-cost housing development on nearby property prices. The results of this pilot study show that the average household in the neighbourhood of Walmer is willing to pay between R27 262 and R195 564 to be located 86m further away from an existing low-cost housing development. In addition to this, the probability of choosing a specific house increases if the house has a swimming pool, an electric fence, the lower its price and the closer it is to the nearest school.

RePEc: Research Papers in Economics, 2011

Social housing projects often face substantial "Not-in-my-backyard" (NIMBY) sentiment and as a re... more Social housing projects often face substantial "Not-in-my-backyard" (NIMBY) sentiment and as a result are frequently plagued by local opposition from communities who argue that nearby property prices will be affected adversely by these developments. International hedonic pricing studies conducted have, however, produced mixed results with some concluding that social housing developments may in fact lead to an improvement in surrounding property values. There is, however, a paucity of South African evidence. This study considers the validity of the most pervasive NIMBY argument, the claim that social housing developments negatively affect nearby property values, by considering the property prices of 170 single-family homes in the Walmer neighbourhood, Nelson Mandela Bay, as a function of their proximity to an existing low-cost housing development. The results of this study indicate that in the case of one Nelson Mandela Bay low-cost housing development, a negative impact is exerted on the property values of nearby houses.

Determining the impact of low-cost housing development on nearby property prices using discrete choice analysis

RePEc: Research Papers in Economics, 2012

ABSTRACT This paper presents an application of the conditional logit model to a small, Nelson Man... more ABSTRACT This paper presents an application of the conditional logit model to a small, Nelson Mandela Bay neighbourhood housing data set, with the objective of determining the impact of proximity to a low-cost housing development on nearby property prices. The results of this pilot study show that the average household in the neighbourhood of Walmer is willing to pay between R27 262 and R195 564 to be located 86m further away from an existing lowâ€”cost housing development. In addition to this, the probability of choosing a specific house increases if the house has a swimming pool, an electric fence, the lower its price and the closer it is to the nearest school.

RePEc: Research Papers in Economics, 2013

The South African Government currently faces the dual problems of climate change mitigation and t... more The South African Government currently faces the dual problems of climate change mitigation and the rollout of electricity provision to rural, previously disadvantaged communities. This paper investigates the economic efficiency of the implementation of concentrator photovoltaic (CPV) technology in the Tyefu area in the Eastern Cape, South Africa, as a means of addressing these problems. Two cost-benefit analyses (CBA) are carried out in the study, namely a private CBA and a social CBA. The private CBA investigates the desirability of the CPV project from a private energy investor's perspective, whilst the social CBA investigates the desirability of the CPV project from society's perspective. The social CBA found that the project was socially viable and was, thus, an efficient allocation of government resources. The private CBA, on the other hand, found that investing in a CPV project was not financially viable for a private investor. With respect to the incentive scheme currently offered to private energy investors, it is recommended that the maximum bidding price of R2.85/kWh be increased. A sensitivity analysis of the bidding price showed that an increase of 300% is required to attract private investors into electricity generation projects.

Studies in Economics and Econometrics

This paper reports the first formal non-market valuation of mountain biking in South Africa by ap... more This paper reports the first formal non-market valuation of mountain biking in South Africa by applying the individual travel cost method (TCM). Due to the non-negative, integer nature of the trip data, several count data models were estimated. Mountain biking is fast becoming one of South Africaâ€™s most popular recreational sports and these estimates of economic value may assist policy-makers in managing mountain biking venues in general, and congestion conflicts, specifically. The locus of this study is the Baviaanskloof Mega-Reserve situated in the Eastern Cape Province of South Africa, part of which was declared a World Heritage Site in 2004. The reserve is a popular site for mountain biking. The economic value estimated, by employing a generalised negative binomial model, for trips taken during 2014 amounted to ZAR1 915 (US$167) per trip.

Journal of Economic and Financial Sciences, 2015

In most hedonic price model studies, the actual sales price of a property is employed as the depe... more In most hedonic price model studies, the actual sales price of a property is employed as the dependent variable in the parametric regression analysis. Although the use of this price is pervasive, alternatives to it do exist. One such alternative is the assessed property value, which is more readily available than the actual property price. The aim of this study is to compare implicit price estimates of property characteristics (both structural and locational) based on actual sales price data and assessed property values. To this end, a seemingly unrelated regression with two hedonic price equations is used, one which employs actual market prices as the dependent variable and the other which employs assessed values. The results show that the hypothesised influence of structural and locational housing characteristics on residential property prices is the same for assessed values, and actual market prices cannot be accepted. This finding should act as a caution for hedonic practitioner...

Municipal management of property valuations for rates purposes: a market-based municipal assessment model versus an attributes-based hedonic price model

South African Journal of Economic and Management Sciences, 2004

This paper reports on a contingent valuation made of the freshwater inflow into the Keurbooms Est... more This paper reports on a contingent valuation made of the freshwater inflow into the Keurbooms Estuary near Plettenberg Bay, South Africa, in April 2001. The value of this water was estimated in terms of the services yielded to recreation users of the estuary, to be between R0,012/m 3 and R0,046/m 3. This value is currently lower than what farmers are willing to pay for the water in this area, as measured by the income capitalisation method, namely R0,125/m 3 , but may increase in the future as more and more South African estuaries are undermined through upstream river water abstraction, and recreational substitutes are diminished. A willingness-topay function was also estimated and show annual levies paid and investment in goods to access the estuary services to be important determinants of willingness-topay. JEL Q25, 26

The Valuation of Estuary Services in South Africa Specifically Regarding Changes to Estuary Services as a Result of Reductions to Fresh Water Inflows-Main …

... The following students participated and contributed dissertations (in one case a treatise) on... more ... The following students participated and contributed dissertations (in one case a treatise) on this basis: Moses Mlangeni Marzanne Potgieter Henri van der Westhuizen Johane Dikgang William Akoto Jedidah Chege Denis Nyaboga (forthcoming) Chatelle Oliver (forthcoming) ...

Ecological Economics, Oct 1, 2016

The views expressed are those of the author(s) and do not necessarily represent those of the fund... more The views expressed are those of the author(s) and do not necessarily represent those of the funder, ERSA or the author's affiliated institution(s). ERSA shall not be liable to any person for inaccurate information or opinions contained herein.

Economic Research Southern Africa (ERSA) is a research programme funded by the National

Using Discrete Choice Analysis to Determine Beachgoer Preferences for Beach Management: A South African Case Study

Studies in Economics and Econometrics, 2017

Beaches are areas of high economic value derived largely from high demand for recreational goods ... more Beaches are areas of high economic value derived largely from high demand for recreational goods and services. These outdoor recreational resources are likely to succumb to considerable health pressures and trade-offs in the allocation of scarce local government level funding. An area of coastline where the recreational experience is being compromised due to high levels of tourist demand is the Nelson Mandela Bay area, South Africa. The primary objective of this paper is to inform policy makers on key public preferences regarding the use of beaches in Nelson Mandela Bay that can be used as inputs to the complex coastal resource allocation process. The application of a choice experiment, based on the concept of random utility theory, revealed that the presence of dogs on beaches and the level of public safety are very important predictors of public choice and should receive immediate attention as far as beach management is concerned.

Ecological Economics, 2016

Studies in Economics and Econometrics, 2011

Using beach visitation data collected via the administration of a questionnaire to 226 respondent... more Using beach visitation data collected via the administration of a questionnaire to 226 respondents, this paper estimates a random utility model of beach recreation. The relative value of selected attributes of beaches is estimated, and the recreational values of lost access to four Blue Flag beaches in the Nelson Mandela Bay area, namely Kings beach, Humewood beach, Hobie beach and Wells Estate beach, respectively are calculated to be R44.73, R24.61, R37.85 and R2.68 per person, per trip.

House Values and Proximity to a Landfill in South Africa

Journal of Real Estate Literature, 2016

(ProQuest: ... denotes formulae omitted.)In South Africa, housing accounts for 29.40% of househol... more (ProQuest: ... denotes formulae omitted.)In South Africa, housing accounts for 29.40% of household assets and 21.68% of total wealth (Simo-Kengne, Bittencourt, and Gupta, 2012). Although these numbers are not as large compared to the U.S. economy, which happens to be respectively 37.78% and 47.92% (Iacoviello, 2011), they most certainly cannot be ignored. Given the importance of housing, it is not surprising that the recent literature on house prices in South Africa has indicated a strong positive impact of house prices on economic growth (Simo-Kengne, Bittencourt, and Gupta, 2012; Chang, Simo-Kengne, and Gupta, 2014) and consumption (Simo-Kengne, Bittencourt, and Gupta, 2013; Apergis, Simo-Kengne, and Gupta, 2014) at the (nine) provincial level.1 Understandably, determining factors that drive regional house prices are of paramount importance. In this paper, due to data availability, we develop a hedonic model of house prices for the New Brighton Township of the Nelson Mandela Bay Metropole (NMBM), Eastern Cape Province, South Africa. The model includes physical, locational, and environmental characteristics as determinants of house prices. We specifically focus on the role the distance from a landfill plays on house prices.South Africans generate 108 million tons of waste per annum, which translates into approximately five kilograms of waste per capita per day (Bothma, 2014). This waste includes general waste (i.e., domestic and household waste, construction and demolition waste, business and commercial waste), unclassified waste (i.e., electronic waste, sewage sludge, brine, bottom ash, and dust), and hazardous waste (i.e., batteries and toxic chemical waste). In excess of 90% of all waste generated is landfilled, whereas less than 10% is recycled (Bothma, 2014). Two types of landfills are used in South Africa: general waste landfills, which accept general waste and unclassified waste, and hazardous waste landfills, which accept hazardous and toxic waste. South Africa is, however, rapidly running out of landfill space, which is exacerbated by a population influx and rapid urbanization. In many cases, disposal sites, which were at one time located an acceptable distance from residential areas, now sit adjacent to generally low-income suburban housing.The negative externalities associated with close proximity to a landfill are well documented (Ready, 2010; Nahman, 2011). These disamenities include rampant pests, air, soil, and water emissions, as well as the spread of litter (du Preez and Lottering, 2009: Nahman, 2011). It follows, therefore, that the prices of houses situated closer to landfills should be lower than those of houses situated further away, all else constant (Nelson, 1992; Bouvier, Halstead, Conway, and Manalo, 2000; Hite, 2001; Ready, 2010). The hedonic pricing model (HPM) has been widely used to identify a direct empirical relation between the characteristics of a house (distance from a landfill being one such characteristic) and the price that an agent is willing to pay. Hedonic prices are the implicit prices of characteristics, which are discovered by agents from observed prices and the associated levels of the attributes (Linneman, 1981; Quigley 1984; Parsons 1986; Zietz, Zietz, and Sirmans, 2008). This allows for estimation of the value of a commodity based on how people's willingness to pay for a house varies with changes in the characteristics of that house. Nelson, Genereux, and Genereux, (1992), Bouvier, Halstead, Conway, and Manalo (2000), and du Preez and Lottering (2009) are some studies that use HPM to specifically identify the impact of a landfill on house prices.International literature predominantly points to a negative correlation between house prices and proximity to a landfill (du Preez and Lottering, 2009; Ready, 2010). Studies confirming a significant negative relation between house values and proximity to a landfill show that house values increase by 5%-7% for every 1. …

Studies in Economics and Econometrics, 2013

The Economic Contribution of the Ocean Sector in South Africa

Studies in Economics and Econometrics, 2014

The contribution of the ocean sector in South Africa is of interest to many - from researchers of... more The contribution of the ocean sector in South Africa is of interest to many - from researchers of ocean resources and environments to firms using the ocean and government departments and nongovernmental organizations with interest in, or responsibility for, the ocean resources and environment. For the purpose of identifying the overall economic contribution this paper describes and applies alternative methods of apportioning GDP into ocean and non-ocean parts. One method uses ocean closeness as the reference for apportioning GDP. It has been estimated that in 1995 the ocean sector contributed about 33% of South Africa's GDP. A major weakness of the closeness to ocean basis for apportioning GDP is that many of the economic activities taking place near to the ocean use little, if anything, of the ocean resources and its environment as inputs in production. A preferred method of identifying ocean and non-ocean parts of GDP is to divide the value added per economic sub-sector (and sub-set) into ocean and non-ocean parts and summing the ocean parts. This method is outlined and demonstrated using South African data for the 2010 year at the third digit level of the standard industrial classification code list (ICCL or SIC). It is found that in 2010 the overall contribution of the ocean-linked sector to GDP was about 4.4 per cent.

Journal of Economic and Financial Sciences, 2017

Many valuations have been made of changes to in-estuary attributes, but few have been made of out... more Many valuations have been made of changes to in-estuary attributes, but few have been made of out-of-estuary attributes. From a recreation perspective, an important type of out-of-estuary attribute is the availability of public paths by which to access attractive features of the estuary environment. This paper values an improvement in the level of public access in the form of an additional nature trail along the banks of the Sundays River Estuary in the Eastern Cape, but does not compare this value with the costs. By means of choice experiment modelling analyses it is estimated that in 2010 the marginal willingness to pay for an investment in a nature trail was R34 per user per annum. In order to determine whether the development of this trail is efficient, this benefit (R34 per user per annum) needs to be compared to the cost of the development, an analysis that remains to be done. However, this finding does serve to provide guidance on how much funding could efficiently be allocat...

Journal of Economic and Financial Sciences, 2012

This paper examines the Nelson Mandela Bay public’s willingness to pay (WTP) for the removal of a... more This paper examines the Nelson Mandela Bay public’s willingness to pay (WTP) for the removal of a local undesirable land use, the manganese ore dumps and the oil tank farm situated within the boundaries of the Port Elizabeth harbour, Eastern Cape, South Africa, by means of the contingent valuation method. Both a non-parametric and parametric estimate of the WTP is derived. Estimated WTP for the removal of this disamenity ranges from R47.09 to R93.21 per household. The aggregate WTP ranges from R13 489 683 to R26 701 496. Due to the sensitivity of the parametric estimate of WTP to functional form specification and the distribution of the random part of preferences, the less restricted non-parametric WTP estimate (R47.09) is more appropriate. The results of this study show that policy-makers should take heed of the importance communities attach to the location of pollution-creating activities in urban areas.