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Willingness to pay for non angler recreation at the lower Snake River reservoirs.

Publication: Journal of Leisure Research
Publication Date: 22-MAR-05
Format: Online
Delivery: Immediate Online Access

Article Excerpt
Dam breaching on the lower Snake River to save endangered salmon and steelhead would eliminate more than 33 thousand acres of flat water extending nearly 140 miles. (1) The site currently contains 26 thousand acres of land area of which half is designated as wildlife habitat. Because of past...

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...failures, new measures to protect the endangered fish have been mandated. The National Marine Fisheries Service 2000 Biological Opinion (NMFS, 2000) specifies that the "action agencies" could request authority from Congress for breaching if mitigation goals are not met according to their designated 10-year timetable. (2) The U.S. Army Corps of Engineers (USACE, 2002) feasibility study of juvenile salmon migration chose further "system upgrades" over breaching, but they state that their selected alternative is consistent with breaching as a final solution. With breaching, flat water used for swimming, water-skiing, propeller-driven boating, and sailing would be mainly replaced with white water and rapids suitable for kayaking, rafting, and jet boating. Also, much additional land area would exist for picnicking, camping, hiking, biking, wildlife viewing, hunting, and other land-based activities. The willingness-to-pay for current non angling recreation activities measures part of the costs of dam breaching, including loss of power generation, barge transport, and a small amount of irrigation. Our benefits estimate for non angling recreation (net consumer value) is subtracted from projected non angling recreation benefits with breaching (Loomis, 2002) to find the effect of dam breaching on non angling benefits. Loomis predicted that non angling recreation benefits with dam breaching would be $192.7 to $310.7 million per year. (His forecast can vary depending on the treatment of non responders and other factors.)

This study uses the travel cost method (TCM) to estimate the net value for non angler recreation at the lower Snake River reservoirs in eastern Washington. We examine existing reservoir recreation with different models and in more detail than was done for the USACE feasibility study. Activities studied include camping, boating, water-skiing, and swimming/picnicking. Estimation of benefits by type of activity allowed us to adjust our survey results to more closely match long-run visitation by activity type. Derivation of benefits by type of recreation activity also is beneficial because they are widely used by federal and state resource managers when local estimates are unavailable (Rosenberger & Loomis, 2000; Rosenberger & Loomis, 2001; Shrestha & Loomis, 2001; Walsh, Johnson & McKean, 1992). Additional activities in the sample (in small numbers) included sailing, wildlife viewing, hunting, and other unspecified activities.

A travel cost demand model relates the number of annual recreation trips to a site to the price of a trip. The traditional approach assumes that the price of a trip is the sum of imputed opportunity time value and pecuniary travel costs (Becker, 1965). The traditional approach can be inappropriate if either, (1) institutional factors make opportunity time value difficult or impossible to monetize, or (2) consumer behavior is different from that assumed by the traditional model. The two-step consumer decision model, discussed below, provides an alternate to the traditional model. Both of the conditions which invalidate the traditional approach are likely to apply to the consumers in our data set. Most respondents indicated they did not have any foregone income while recreating and experimental modeling showed that when actual recreation participation decisions were made, consumer behavior was not influenced by opportunity time cost. Appending imputed opportunity time cost to pecuniary travel cost actually reduced the goodness of fit (discussed in a later section). Thus, the traditional model, which combines an imputed opportunity time cost with pecuniary travel cost, was not appropriate for this sample. The alternate two-step consumer decision model, which is discussed below, includes pecuniary outlay and physical time outlay as separate trip price variables and both money income and available free time are included as separate constraint variables which can limit trips demanded.

The Non-Equilibrating Labor Market

The wage rate (usually with some downward adjustment) is used to monetize travel time in the traditional model but wages measure the value of time only with equilibrating labor markets. A non-equilibrating labor market includes (1) persons who are not in the labor market because they are in school, unemployed, not in the correct age range for employment, independently wealthy, retired, or disabled, and (2) persons who are employed by firms with market power that fix work hours and pay rates. Lack of participation in a free competitive labor market means either that the wage rate does not exist or does not represent the true opportunity time value. The individual will allocate their scarce time in terms of alternative activities sacrificed but they have no meaningful measure of money opportunity time cost. Modeling recreation demand with non-equilibrating labor markets has been proposed by Brown and Nawas (1973), Gum and Martin (1975), Larson (1993a, 1993b), McConnell (1999), Ward and Beal (2000), Ward and Loomis (1986), and applied by Bockstael, Strand, and Hanemann (1987), Larson (1993b), Loomis (2002, 2003), McKean, Johnson, and Taylor (2003), McKean, Johnson, and Walsh (1995), McKean, Walsh, and Johnson (1996), Shaw and Feather (1999), and Ward (1983, 1984, 1989).

More than 87% of the persons in our sample did not give up income to participate in recreation at the reservoirs. Clearly, this sample is dominated by persons for whom foregone income is irrelevant. That they do not consider foregone income as part of the price of a recreation trip is shown below in our empirical test of the traditional model. (One possible opportunity time cost which we did not measure in our survey was the expenditure for taking care of the house or yard while on vacation. This cost would not depend on the recreationist's value of time but rather on the replacement cost for unpaid household services by the recreationist. We doubt that replacement cost for household services would be important for the relatively short time period of the recreation trips in this particular study.)

The Two-Step Decision Model

The two-step decision model of consumer behavior first considers "long run" life-changing decisions (Bockstael et al., 1987; Larson, 1993b; McKean et al., 2003; Shaw & Feather, 1999). Thus, for persons of working age, specification of a two-step decision model begins with consideration of the labor market. (3) Variables related to the labor market are designated as step one variables while a consumer's selection of each consumer good is relegated to step two. Step one decisions can involve, work time versus non work or consumption time, choice of occupation, industry of employment, investment in education or skills, attributes of the region of residence, choice of residence location relative to work versus recreation sites, and other long-run factors affecting quality of life. The first step in the decision process determines total free time which can be used for consumption but does not attempt to decide among individual goods. In contrast, the traditional model assumes that all decisions are made in a single step. Thus, each time a consumer considers the purchase of a time-consuming good they would need to reevaluate the effect on their income and negotiate with their employer...

NOTE: All illustrations and photos have been removed from this article.



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