Rounding in Recreation Demand Models: A Latent Class Count Model
AbstractA commonly observed feature of visitation data, elicited via a survey instrument, is a greater propensity for individuals to report trip numbers that are multiples of 5's, relative to other possible integers (such as 3 or 6). One explanation of this phenomenon is that some survey respondents have difficulty recalling the exact number of trips taken and instead choose to round their responses. This paper examines the impact that rounding can have on the estimated demand for recreation and the bias that it may induce on subsequent welfare estimates. We propose the use of a latent class structure in which respondents are assumed to be members of either a nonrounding or a rounding class. A series of generated data experiments are provided to illustrate the range of possible impacts that ignoring rounding can have on the estimated parameters of the model and on the welfare implications from site closure. The results suggest that biases can be substantial, particularly when then unconditional mean number of trips is in the range from two to four. An illustrative application is provided using visitation data to Saylorville Lake in central Iowa.
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Bibliographic InfoPaper provided by Iowa State University, Department of Economics in its series Staff General Research Papers with number 31594.
Date of creation: 02 Jun 2010
Date of revision:
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More information through EDIRC
recreation demand; count data; rounding;
Find related papers by JEL classification:
- C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions
- Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-06-11 (All new papers)
- NEP-ECM-2010-06-11 (Econometrics)
- NEP-TUR-2010-06-11 (Tourism Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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