Closeness Of A Household To The Hydraulic Drilling Sites

Student’s Name Tutor’s Name Course Date Summary of the Materials (Results) The test on cross-sectional estimates was to investigate the closeness of a household to the hydraulic drilling sites and their need for groundwater. It also includes an inverse distance to estimate if there was a difference between permitted wells and the hydraulic drilled wells. The results specified that the closer a household was to the site, the higher its property value. However, due to the contact with groundwater, it showed negative and insignificant results, in which the property value decreased because underground water was unfit for consumption. For instance, a PWSA property is 1000 meters away from a well. If the distance increases by a meter, the property's price would decrease by 0.03 percent. Also, these properties that depend on groundwater would continue to make profits because of the wells until the negative effects of the drilling set in. The property fixed results show similar results with a positive impact on properties in the PWSA areas with a coefficient correlation of -0.0764 and a negative impact on the groundwater areas, which has a correlation of 0.059 percent. The results indicate that even though the lease payments are profitable to the PWSA households, they are not able to avoid the negative effects of the drilling process. There is more impact when cities are not in the picture since the coefficient correlation decreases even further. It shows that hydraulic drilling is more beneficial to cities in terms of development. Using fixed variables is not accurate because of varying unobservable such the economic boom and lease payments made to homeowners. As such, there is a need to use a triple difference method, that is, difference-to-difference-to-difference method to achieve better results. The above method considers two groups, which are the PWSA property and groundwater property. The regression equation states that the logarithm of the property price is equivalent to the sum of the number of well pads within 2000m at the time of sale plus an indicator that the property relies on groundwater plus year fixed effect plus property fixed effect. The DDD specification looks at three subsamples. The first specification looks at all PWSA properties and groundwater properties. The second specification considers only PWSA border homes while the third looks at all properties in the Washington county inclusive of those with permitted wells. Like the cross-sectional and the FE results, properties that are within 2000 meters to the well pad have a higher property value. The drilled wells have a negative effect on properties that rely on groundwater. In conclusion, the study compares properties situated near and far from drilling sites for shale gas and investigates the ...