Nonparametric correlogram to identify the geographic distance of spatial dependence on land prices

Abstract

The spatial autocorrelation measurement of land prices uses a covariance function to describe the spatial dependence and it can be identified as a geographic distance on the correlogram. The geographic distance of spatial dependence can state that land prices are interdependent to each other and scattered in the research area. Therefore, the purpose of this research is to define the geographic distance of spatial dependence on land prices using a nonparametric correlogram. A nonparametric approach to covariance functions using the composition of Bessel and Gaussian-type functions are adopted because they correspond to the positive definite characteristics. The cubic spline interpolation is used to refine the curve fitting, while the intersection between the nonparametric correlogram value C(h) against the horizontal axis is determined using the Jenkins Traub algorithm. The results showed that the nonparametric correlogram identified a geographic distance of land prices smaller than the correlogram used so far. A small distance means that the land price in a location is greatly affected by the neighbors compared to a larger distance.