Luc Anselin and Nancy Lozano-Gracia 1239Overall, there is ample empirical evidence that properly accounting for spatial
dependence by means of spatial econometric methods pays off in terms of superior
estimates of marginal price coefficients as well as welfare effects. However, several
methodological issues still require further investigation.
26.6 Empirical evidence: spatial heterogeneity
Following the same organization as the methodological discussion, spatial hetero-
geneity can be classified as either discrete or continuous. In this review of some
of the empirical literature, we follow the same distinction. An overview of the
empirical applications considered is given in Table 26.4.
26.6.1 Discrete heterogeneity: sub-markets
Heterogeneity in the determination of house prices across spatial sub-units of the
market is commonly approached by considering this as a special case of market seg-
mentation (see Stevenson, 2004, for a review). This segmentation may result from
the existence of market barriers or other types of market imperfections across space.
Table 26.4 Spatial HeterogeneityArticle SourceGoodman (1981) Journal of Regional Science
Can (1990) Economic Geography
Can (1992) Regional Science and Urban Economics
Allenet al. (1995) Journal of Real Estate Finance and Economics
Goetzmann and Spiegel (1997) Journal of Real Estate Finance and Economics
Goodman and Thibodeau (1998) Journal of Housing Economics
Bourassaet al. (1999) Journal of Housing Economics
Pavlov (2000) Real Estate Economics
Fotheringhamet al. (2002) Geographically Weighted Regression
Bourassaet al. (2003) Journal of Housing Economics
Fiket al. (2003) Real Estate Economics
Gelfandet al. (2003) Journal of the American Statistical Association
Goodman and Thibodeau (2003) Journal of Housing Economics
Theriaultet al. (2003) Property Management
Dayet al. (2004) CSERGE Working Paper
Ugarteet al. (2004) Spatial and Spatiotemporal Econometrics
Brasington and Hite (2005) Regional Science and Urban Economics
Choet al. (2006) Journal of Agricultural and Resource Economics
Farber and Yeates (2006) Canadian Journal of Regional Science
Kestenset al. (2006) Journal of Geographical Systems
Bitteret al. (2007) Journal of Geographical Systems
Bourassaet al. (2007) Journal of Real Estate Finance and Economics
Longet al. (2007) Working Paper: Center for Spatial Analysis
McMaster University, Hamilton, ON
Bourassaet al. (2008) Swiss Finance Institute Research Paper
Wanget al. (2008) Environment and Planning A