Gun control as a response to gun violence is currently at the forefront of political debate in the United States. The foundation of this paper revolves around crime and real estate supported by background literature describing external effects on property prices to set the framework for the research on mass shootings and residential property values. The findings in this paper are based on 73 events involving mass shootings in the United States from 1996 to 2015.
I find that the effect of mass shooting events plays a significant role in the decline in property values after a mass shooting in areas near the shooting event. Interestingly, this answer is otherwise not supported by probability data, as death by mass shooting is highly unlikely.
Introduction
A Guide to Mass Shootings in America by Mother Jones states that "there have been at least 85 [mass shootings] in the past three-plus decades...". Pro-gun advocates tend to believe that more gun ownership creates a safer environment overall, arguing that gun control is not the problem, but that gun and gun safety education will prevent accidental deaths. The arguments for each side of the gun control debate have strong and irrefutable evidence.
However, a recent study was conducted to show the correlation between crime rates and home values in surrounding neighborhoods in the suburbs of Chicago. This is evident in the significantly lower home values and significantly higher foreclosure rates in zip codes with a higher delinquent index, but it may not be as apparent in the home price appreciation numbers, which are actually slightly stronger over the past year and five years in zip codes with a higher offender index. However, the 10-year appreciation figures show that home values in the zip codes with the lowest risk for offenders were not hit as hard during the housing downturn and returned to their previous highs faster – even more than the previous highs.” The study was done on more than 10,000 postcodes, supply.
This research shows that while home values have generally increased since the recession, crime rates likely play a role in the increase in values. This then raises the question: does crime lower home values, or does low home value attract criminals?
Relevant Background
An article by Jaren Pope looks at Megan's Law in relation to surrounding property values. A similar paper by Leigh Linden and Jonah Rockoff examines combined data on property values and the North Carolina Sex Offender Registry to see how people feel about living in some proximity to a sex offender. One of the first articles on terrorism after 9/11 discusses the impact of terrorism on urban form.
Their article examines the theory that minorities, especially Muslims, are considered a threat in terms of terrorism and property values decline when minorities are present. After the murder of Theo van Gogh in Amsterdam, the hypothesis was found to be true. The results show that in neighborhoods with more than 10 percent Muslims, property values decreased by about three percent over a ten-month period.
Diverging from the theme of crime, but still influencing one's decisions regarding risk and property values, is the ever-growing problem of pollution and natural disasters. Also in the core category, the authors Gawande and Jenkins-Smith later researched the impact of core facilities on property values. Areas with widespread knowledge of the existing nuclear plant activity and low risk perception did not see a change in property values.
Daniel Winkler and Bruce Gordon studied the effect of the British Petroleum oil spill on coastal property prices. In the wake of the 9/11 terrorist attack, the EPA removed data for certain chemical facilities from its website. It was concluded that the determining factor in declining property values was individual hazardous sites themselves (Wesinger 2006).
Real estate values were found to be lower during operation and to have increased fairly well after the shutdown; however, the closest traits have taken considerably longer to recover, but are still increasing (Dale, Murdoch, Thayer, and Waddell 1999). Following the previous discussion on the risk of terrorism, terrorist attacks are difficult to evaluate due to the inconsistency and unpredictable nature of events. Natural disasters generally have two major implications for the housing market, short-term fluctuations in home values and long-term risk perceptions.
When Andrew missed this particular county, property values were examined to determine the perceived risk of the hurricane without actual damage. In areas with 100-year floodplains, property values did not change, showing that buyers understood the risk more accurately.
Hypothesis
Data
The Last Sale Price is the dollar ($) value for which the property was last sold. Homeowner exemption is a dummy variable equal to one if the property is accepted for homestead exemption, 0 otherwise. This definition referenced with a dataset by Follman, Aronsen, and Pan (2013) constitutes the mass shooting evidence base.
The data was derived from a set of characteristics for both mass shootings and shooter-specific. The weapon criterion includes the legality of the purchase of the weapon, the number of weapons used and individual types, and the amount of ammunition. As Table 1 shows, compared to being assaulted with a firearm, individuals are 54 times more likely to die from heart disease, 12 times more likely to die from stroke, and 6.7 times more likely to that they will die of diabetes (Table 1).
A comparison of mass shooting data with other aggregate mortality data shows that mass shootings account for no more than 0.0029 percent of all deaths in a given year. Permit to Purchase: A certificate, ID or other permit is required to acquire/purchase any legal firearm (terminology varies from state to state). It should be noted that the federal ban on assault weapons expired in 2004; however, several countries have either fully adopted it.
The Federal Assault Weapons Ban of 1994 defined certain firearms as assault weapons based on the characteristics they possess (Public Safety and Recreational Firearms Use Protection Act, H.R.3355, 103rd Congress. Concealed Carry Permit: Allows the legal carrying of a firearm in the then disclosed in a concealed manner on one's person or nearby Open Carry: Permitting the carrying of a legal firearm in public in an open manner where a casual observer may observe an individual carrying a carry a firearm.
National Firearms Act Restrictions: The National Firearms Act of 1968 (NFA) defines a number of categories of regulated firearms, collectively known as NFA firearms. These range from a firearm's firing capacity (semi- and fully automatic), the length of the firearm's barrel, suppression devices, and auxiliary devices considered destructive devices (i.e., grenades, bombs, explosive missiles, poison gas weapons, and other comparable devices). Peaceful Travel Act: Regulates the transportation of a firearm for any lawful purpose from any place where a person may lawfully possess and carry such firearm to any other place where he or she may lawfully possess and carry the firearm, if the firearm during transportation is unloaded. , and neither the firearm nor ammunition being transported is readily accessible or is directly accessible from the passenger compartment of such transport vehicle.
Empirical Methods
Results
Once again, Shooting is negative and significant, suggesting that the post-shooting home sales price declines. These findings suggest that home sales price is directly related to laws identified with one's right to possess or carry in public as well as defend one's property.
Discussion
Consequently, if mass shooting events cause people to overestimate their likelihood of death, we would expect to observe a decline in home sale prices in markets that experienced a mass shooting. Consistent with this expectation, the results suggest that the occurrence of a mass shooting in a given state is associated with a decline in home prices following the event. Overall, the analysis suggests that the occurrence of a mass shooting, through its influence on individuals' perception of risk, is associated with real economic consequences in the housing market.
The fact that individuals change their market behavior after the event—despite the fact that the probability of death from a mass shooting event is extremely small—suggests that individuals are irrationally exaggerating their probability of death after the event.
Conclusion
Terrorism and attitudes toward minorities: The effect of the Theo van Gogh assassination on house prices in. The effect of the BP oil spill on volume and sale prices of Oceanfront Condominiums. Shooting indicator variable for a mass shooting =1 the year of and after the event, 0 otherwise Ln(Sales Price) Natural log of sales price (dependent variable).
Ln(DistShoot) The natural log of the distance (in miles) from the house to the shoot location Age The age of the house at the time of sale. Lot Size The size of the lot on which the house is built, in square feet Bsqft The square footage of the house. Fireplace Indicator variable for the presence of a fireplace, Fireplace=1 otherwise Sale_year Year in which the house was sold.
PurchasePerm indicator variable for the country in which a permit is required to purchase a weapon. GunRegister indicator variable for the country in which the gun must be registered. AssaultLaw indicator variable for a country that prohibits the sale of assault weapons. LicenseReq Indicator variable for the state in which a license is required to legally possess a firearm. CCWpermits An indicator variable for the country in which a concealed carry permit is available. NFArestrict indicator variable for a country that falls under NFA restrictions PeacJournLaw Indicator variable for a country that has a Peaceful Journey Law. StandGround indicator variable for a country that has a standing constitution.
Tables and Figures
