The Generalized Travel Cost Model and Water Quality Benefits: A Reconsideration

Abstract

With federal agencies required to conduct benefit-cost analyses for each new major regulation, analyses of water quality changes are likely to be an increasingly important part of the policymaking process. A revised version of the travel cost demand model and illustrations show the importance of these revisions for the model's estimates. Although the magnitude of the difference in benefit estimates between the original and new versions of the model varies with the specific recreation site selected, the findings indicate that the original model generally implied estimated benefits from three to over 30 times as large as the revised model. This implies that judgment can play an important role in the definition and use of economic models, as well as the need for better information on households' recreation decisions and more complete description of recreation site characteristics. 15 references, 4 tables.