Economic Value of Public Access to Great Lakes Beaches

Frank Lupi,1 Feng Song & Michael Kaplowitz

1 Department of Ag, Food, & Resource Economics; Department of Fisheries and Wildlife;

Partnership for Ecosystem Research and Management

Beaches are Priceless?

• Not bought and sold in markets…– But valued by people…

• Use “Non market valuation” techniques

• Gap in literature– Dozens of studies on saltwater beach values– Only a couple for GL beaches

Use “travel cost method”

• Method of estimating demand and value for recreation related resources

• Uses time & money costs of travel as the price of recreation trips

• Use trips & price to estimate demand

• Relate this to site features

• Use to value and forecast demand response when site features or access change

Demand Curve

Shift in Demand quality/features change

demographic changes substitute beach changes

Beach Recreation Model

• Usage = Fn(travel costs, environmental quality)• Behavioral Model

– How uses change when EQ changes– Can use for economic valuation

Beaches are Everywhere…

One beach, people all over

Where do they come from?

Single person, beaches all over

Were do they go?

People from Everywhere…

10miles

50miles

Which site is better?

Assume an economist goes to the beach...

“RUM” Travel Cost

Recreational Uses/Behavioral Models(Research steps)

• Collect data with surveys of users

• Collect data on environmental quality of sites

– Needs spatial & temporal variation

• Econometric modeling

• Application

Beach Uses

• “Pilot” survey

• Collected data on Michigan GL beach use

– Web survey, N=3,286

– Beach visited the most in past years, N=2,566

• Located 1,710 of these

• Estimated basic demand models

– Trips significantly & positively related to beach length and fewer beach closure days

Model Specification

• Estimated as “two-level nested logit”

• GL Beaches in MDEQ database– grouped at zipcode level– 143 site groups

• Data for Michigan residents only (our sample)

Beach Visits Nesting Structure

25 Most-Valued GL BeachesResident’s net benefits per predicted trip

• A trip to typical site is worth $48/day.

• The value of “access” to the site

Value to Users of GL Beaches

Great Lake

Value all beaches at

this GL(per “any” trip)

Total Values13 mil trips 26 mil trips

Michigan $75.55 $982 mil $1,964 mil

Huron $13.89 $180 mil $361 mil

Erie (St.Clair) $13.28 $173 mil $345 mil

Superior $2.67 $35 mil $69 mil

What’s Missing

• Trip data– Better estimates of total trips– Timing of trips (when in the season)

• Additional site variables– Water clarity, slope, facilities, water

temp, advisories at time, crowding, waves, etc.

• Good average site values– Find advisory effects, possible

stigma, but not ready for closure valuation via dX

Next Steps

• Working on new model– New survey– More info on trips– Additional site data

• Opportunities to apply & connect with other research…

• Acknowledgements