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Linking Recreation Demand and Willingness to Pay with the Inclusive Value

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Linking Recreation Demand and Willingness to Pay with the Inclusive Value. John C. Whitehead, Peter A. Groothuis, Rob Southwick. Whitehead (1995a, 1995b). X = a 0 + a 1 C + a 2 Q + a 3 Y WTP( D Q) = b 0 + b 1 C + b 2 D Q + b 3 Y where b 1 ≈ D X if b 1 =0, then WTP = nonuse value

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### Linking Recreation Demand and Willingness to Pay with the Inclusive Value

John C. Whitehead, Peter A. Groothuis, Rob Southwick

Whitehead (1995a, 1995b)
• X = a0 + a1C + a2Q + a3Y
• WTP(DQ) = b0 + b1C + b2DQ + b3Y
• where b1≈DX
• if b1=0, thenWTP = nonuse value
• Huang, Haab and Whitehead (1997) …
Whitehead (2005)
• When C is hard to measure (multiple sites, access points, etc)
• WTP(DQ) = g0 + g1DX + g2DQ + g3Y
• DX = f(DQ,Y,Z)
• Identification of DX is a hassle …
Sample
• Fishing and Hunting license holders in the watershed
• 22% response rate
• n = 251 license holders
• General population sample …
Typical Trip RUM

No trip

46%

Iosco

6%

Arenac

7%

Bay

25%

Huron

9%

Tuscola

6%

WTP > 0?
• Would you be willing to make a one-time donation of money to the Saginaw Bay Coastal Marsh Trust Fund within the next 12 months?
WTP > A?
• If about 1 percent (1 in 100) of all households in Michigan made a one-time donation of \$A, the Trust Fund would have enough money to purchase and manage X acres of coastal marshes.
• Remember, if you made a one-time donation of \$A into the Trust Fund, you would have \$A less to spend on other things.
• Also remember that protected marsh would no longer be available for conversion to other uses.
• Would you be willing to make a one-time donation of money to the Saginaw Bay Coastal Marsh Trust Fund within the next 12 months?
Conclusions
• Recreation nonusers hold nonuse values
• Recreation users do not hold nonuse values.
• Much of the willingness to pay estimate is comprised of nonuse values and the additivity assumption adopted by Whitehead et al. (2006) is appropriate
Future Research
• Other applications …
• NC beach recreation (2003 data): inclusive value is positive and statistically statistic but offers no improvement over minimum travel cost