Densities Rather than Shares: Improving the Measurement of Congestion in Recreation Demand Models

• Published in: Environmental & resource economics Vol. 61; no. 2; pp. 127 - 140
• Main Authors: Bujosa, Angel, Riera, Antoni, Hicks, Robert L., McConnell, Kenneth E.
• Format: Journal Article
• Language: English
• Published: Dordrecht Springer Netherlands 01.06.2015; Springer Nature B.V
• Subjects: Beaches; Congestion; Demand; Economic analysis; Economic Policy; Economic theory; Economics; Economics and Finance; Environmental Economics; Environmental Law/Policy/Ecojustice; Environmental Management; Measurement; Natural resources; Preferences; Recreation; Recreation demand; Regression analysis; Statistical analysis; Recreation demand; Control function; Beaches; Congestion; Endogeneity; Travel cost method
• ISSN: 0924-6460; 1573-1502
• DOI: 10.1007/s10640-014-9785-9

While economists have successfully addressed the endogeneity of congestion in revealed preference approaches, little attention has been devoted to measuring congestion. In fact, most applications measure congestion as a simple count of users or, at best, consider the shares of users, defined as the proportion of people visiting a site during the course of the season. However, only when all sites have a similar size or length and the total number of visitors is constant over time, can these measures be used as a proxy for congestion. In general, these assumptions are unrealistic. In this paper we examine site density measures rather than participation shares as a measure of congestion. We show that endogeneity problems can be addressed using a control function approach and demonstrate that the density of users leads to more statistically significant coefficients of congestion.