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Endogenously chosen travel costs and the travel cost model: an application to mountain biking at Moab, Utah

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  • Peter Fix
  • John Loomis
  • Rick Eichhorn

Abstract

The travel cost model is frequently used to estimate net willingness to pay for recreation at remote sites by using the visitor's travel costs as a proxy for the price of recreation. However, some concern has been raised over the validity of using the visitor's stated travel costs as a proxy for price. This paper addresses some of these concerns, by examining the possible over-estimation of consumer surplus due to endogenously chosen travel costs. This paper extends past theoretical work for the linear model by developing a correction for endogenously chosen travel costs in more commonly used nonlinear models such as the Poisson or count data model. Also provided is the first empirical test of the presence of endogeneity and an estimate of the magnitude of the error from ignoring endogeneity in travel costs. After applying this test and the correction to data that was gathered for mountain biking at Moab, Utah the estimate of consumer surplus falls from US $153 to US $135, which is a 12% reduction.

Suggested Citation

  • Peter Fix & John Loomis & Rick Eichhorn, 2000. "Endogenously chosen travel costs and the travel cost model: an application to mountain biking at Moab, Utah," Applied Economics, Taylor & Francis Journals, vol. 32(10), pages 1227-1231.
    • Handle: RePEc:taf:applec:v:32:y:2000:i:10:p:1227-1231
    DOI: 10.1080/000368400404371
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    Citations

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    Cited by:

    1. Bowker, James Michael & Starbuck, C. Meghan & English, Donald B.K. & Bergstrom, John C. & Rosenberger, Randall S. & McCollum, Daniel W., 2009. "Estimating the Net Economic Value of National Forest Recreation: An Application of the National Visitor Use Monitoring Database," Faculty Series 59603, University of Georgia, Department of Agricultural and Applied Economics.
    2. Bengochea, A., 2003. "Valoración del uso recreativo de un espacio natural," Estudios de Economia Aplicada, Estudios de Economia Aplicada, vol. 21, pages 321-338, Agosto.
    3. Dominic Moran & Esmond Tresidder & Alistair McVittie, 2006. "Estimating the Recreational Value of Mountain Biking Sites in Scotland Using Count Data Models," Tourism Economics, , vol. 12(1), pages 123-135, March.
    4. Broadstock, David C. & Collins, Alan, 2010. "Measuring unobserved prices using the structural time-series model: The case of cycling," Transportation Research Part A: Policy and Practice, Elsevier, vol. 44(4), pages 195-200, May.
    5. A. J. Hekman & D. B. Deisenroth, 2013. "An empirical approach for directly accounting for expectations in behavioural models," Applied Economics Letters, Taylor & Francis Journals, vol. 20(14), pages 1318-1321, September.

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