Social Costs of Air Transport: A Case Study of Yangcheon-gu

The aviation industry plays a significant role in the development of national and regional economies, but it also creates negative externalities through airport noise. For the aviation industry to grow, these social costs need to be internalized. This study empirically analyzes the impact of airport noise on housing prices, focusing on residential properties in Yangcheon-gu, a district near Gimpo Airport. The key findings are as follows: <br/> First, over the analysis period (2017-2022), it’s estimated that residential property values in airport noise zones were approximately 21.5% lower in area(61~66 LdenB) and 37.3% lower in area(66~70 LdenB) compared to those in non-airport noise zones. Second, airport noise acts as a factor that segments the housing market. Third, the social costs incurred in Yangcheon-gu due to air transport are estimated to be approximately 3.5281 trillion Korean won as of 2022. The results of this study are expected to serve as important reference material for future plans concerning the construction of new airports, expansion, or an increase in operations.