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The Necessity for Substitute Prices Recreation Demand Analyses

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  • Donald H. Rosenthal

Abstract

Omitting substitute prices from a travel cost model is shown to cause a significant bias in consumer surplus estimates. Three sets of travel cost models are developed from a common data base representing 60,000 day-users of U.S. Army Corps of Engineer reservoirs in Kansas and Missouri. The firct set of models omitted substitute prices; the latter two sets included them. An analysis of variance test showed that consumer surplus estimates from the first set of models were significantly higher than the other two (F = 26.2 with 2, 20 degrees of freedom). The theoretical and practical implications of these findings are discussed.

Suggested Citation

  • Donald H. Rosenthal, 1987. "The Necessity for Substitute Prices Recreation Demand Analyses," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 69(4), pages 828-837.
    • Handle: RePEc:oup:ajagec:v:69:y:1987:i:4:p:828-837.
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    File URL: http://hdl.handle.net/10.2307/1242194
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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. K. G. Willis & G. D. Garrod, 1991. "An Individual Travel‐Cost Method Of Evaluating Forest Recreation," Journal of Agricultural Economics, Wiley Blackwell, vol. 42(1), pages 33-42, January.
    3. Jakub Głowacki, 2018. "Monetization of social effects," Ekonomia Społeczna/Social Economy, Collegium of Economy and Public Administration, vol. 2, pages 33-40.
    4. Chin†Huang Huang, 2017. "Estimating the environmental effects and recreational benefits of cultivated flower land for environmental quality improvement in Taiwan," Agricultural Economics, International Association of Agricultural Economists, vol. 48(1), pages 29-39, January.
    5. Catherine Heyes & Anthony Heyes, 1999. "Willingness to Pay Versus Willingness to Travel: Assessing the Recreational Benefits from Dartmoor National Park," Journal of Agricultural Economics, Wiley Blackwell, vol. 50(1), pages 124-139, January.
    6. von Haefen, Roger H., 2010. "Incomplete Demand Systems, Corner Solutions, and Welfare Measurement," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 39(1), pages 1-15, February.
    7. Hailu, Getu & Boxall, Peter C. & McFarlane, Bonita L., 2005. "The influence of place attachment on recreation demand," Journal of Economic Psychology, Elsevier, vol. 26(4), pages 581-598, August.
    8. Chun-Chu Yeh & Cheng-Shen Lin & Chin-Huang Huang, 2018. "The Total Economic Value of Sport Tourism in Belt and Road Development—An Environmental Perspective," Sustainability, MDPI, vol. 10(4), pages 1-14, April.
    9. Paula Simões & Luís Cruz & Eduardo Barata, 2012. "Non-market Recreational Value of a National Forest: Survey Design and Results," GEMF Working Papers 2012-09, GEMF, Faculty of Economics, University of Coimbra.
    10. Rosenberger, Randy & Loomis, John & Shrestha, Ram, 1999. "Meta-Analysis of Outdoor Recreational Use Value Estimates: Convergent Validity Tests," Western Region Archives 321710, Western Region - Western Extension Directors Association (WEDA).
    11. Anders Van Sandt & Dawn Thilmany McFadden, 2022. "Navigating the corn maze: Customizing travel cost models to value market segments in heterogeneous industries," Tourism Economics, , vol. 28(4), pages 899-919, June.
    12. Mani Nepal & Rajesh Kumar Rai & Saudamini Das & Laxmi Dutt Bhatta & Rajan Kotru & Madan Singh Khadayat & Ranbeer Singh Rawal & G. C. S. Negi, 2018. "Valuing Cultural Services of the Kailash Sacred Landscape for Sustainable Management," Sustainability, MDPI, vol. 10(10), pages 1-19, October.

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