measuring the value of remediation in muskegon lake n.
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Measuring The Value of Remediation in Muskegon Lake. Dr. Paul Isely Seidman College of Business Grand Valley State University & Carrie Hause Elaine Isely. Funding. National Oceanic and Atmospheric Administration Great Lakes Commission

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measuring the value of remediation in muskegon lake

Measuring The Value of Remediation in Muskegon Lake

Dr. Paul Isely

Seidman College of Business

Grand Valley State University

&

Carrie Hause

Elaine Isely

funding
Funding
  • National Oceanic and Atmospheric Administration
    • Great Lakes Commission
    • West Michigan Shoreline Regional Development Commission
  • Area of Concern in Muskegon Lake
  • $10 million ARRA funding
  • Socioeconomic monitoring
purpose
Purpose
  • Hedonic Analysis of Housing Values
  • Travel Cost Study of Recreation Values
  • Contingent Valuation study of Use and Non-Use Values
slide6
Data
  • County assessor database
    • House characteristics
    • Sales information
  • AWRI shoreline inventory
slide7

Houses > 800m from Lake not Used

Houses affected by Lake Michigan not Used

Houses <100m from Lake not Used

model
Model

LnPrice as a function or:

Floor area .000359***

Basement area .000118***

age -.00563***

age2 .000018**

Bear Lake .497***

Garage space .0562***

Industrial -.068

Stone .0529*

Bathrooms .0606***

Yearsold 2 - 20 SUPPRESSED

District2 -.24***

District3 -.26***

Occupancy2 -.18***

Occupancy3 -.0712

NEIGHBORHOODS SUPPRESSED

Distance Lake -.000151***

Lnnatratio .0297***

Lnhardratio -.0532***

_cons 10.7***

N 934

legend: * p<.1; ** p<.05; *** p<.01

value of lake recreation
Value of Lake Recreation
  • Mailed survey as part of a CV study
  • A little more than 15% response rate
the question
The QUestion

To restore just 1 acre of wetland habitat in Muskegon Lake, 1 in every 300 households in Michigan would need to contribute $A to this fund. If more households contribute, more habitat can be restored.

Given your household income and expenses, would you be willing to make a one time, tax-deductible donation of $A? _____YES _____NO

the results
The Results
  • Model 1 - $2.5 Million
  • Model 2 - $9 Million
  • Average $5.7 Million
  • Re survey occurring this year to improve sample
travel cost1
Travel Cost
  • Stated costs plus time cost
  • Calculated costs using mileage and normal expenses plus time cost
  • These were averaged together for the model estimations
consumer surplus
Consumer Surplus

Value in $

Travel Cost

Trips

Quantity

value of a trip 2009
Value of a Trip 2009
  • Coefficient on TRAVEL COST is -0.036
  • Value of a single trip is 1/(-βTRAVEL COST)
  • Value of a single trip to Muskegon Lake is $27.77