Valuing Beach Access and Width with Revealed and Stated Preference Data

Abstract

In this article we present results from a study of recreation demand for southern North Carolina beaches. We combine revealed preference and stated preference data in order to estimate the changes in recreation demand that might occur with beach nourishment and parking improvements necessary to satisfy the requirements for U.S. Army Corps of Engineers cost-share. We illustrate the numerous ways that hypothetical bias in stated preference data can lead to increases in the estimates of the economic benefits of recreation and recreation quality improvement. Hypothetical bias affects estimates of the number of trips and slope coefficients. Hypothetical bias does not affect elasticity or consumer surplus per-trip estimates. When the product of trips and consumer surplus per trip is taken as an estimate of consumer surplus per season, hypothetical bias leads to upwardly biased seasonal consumer surplus estimates. These results suggest that stated preference recreation demand data, in isolation from revealed preference data, may be suitable for estimation of consumer surplus per trip but not consumer surplus per season.