Undergraduate Honors Theses

Thesis Defended

Spring 2019

Document Type

Thesis

Type of Thesis

Departmental Honors

Department

Economics

First Advisor

Jonathan Hughes

Abstract

The use of hydraulic fracturing technology for oil and gas production has rapidly spread across the United States. As fracking production has moved closer to populated regions, concerns have been raised by homeowners and politicians about water contamination, air and noise pollution, and the potential impact of fracking on property values. In this paper, I examine how a deadly 2017 fracking explosion in Firestone, Colorado, impacted the effect of fracking wells on housing values in Boulder County. Using a hedonic pricing model, I control for other factors that influence a home’s price to isolate the effect of fracking wells on housing values. I differentiate the additional effect of a fracking well on the value of a home before and after the Firestone fracking explosion. I find that after the Firestone explosion, a fracking well within one kilometer of a home decreases a home’s value by an additional -0.313%. Further, I find that this additional effect diminishes over time, having the greatest magnitude in the first year following the explosion.

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