Using Revealed Preference Behavioral Models to Correctly Account for Substitution Effects in Economic Impact Analysis

This study presents a methodology to correctly account for substitution patterns in estimates of final demand used in economic impact analysis. Then, this methodology is demonstrated empirically using recreational tourism data. Specifically, this study a) presents the results of a behavioral model f...

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Bibliographic Details
Published inThe journal of regional analysis & policy Vol. 43; no. 2; p. 157
Main Authors Deisenroth, Daniel B, Loomis, John B, Bond, Craig A
Format Journal Article
LanguageEnglish
Published Manhattan Mid-Continent Regional Science Association 2013
Subjects
Behavior
Bias
Economic activity
Economic impact
Estimates
Impact analysis
National monuments
National parks
Parks & recreation areas
Preferences
Role models
Studies
Tourism
United States > US
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Summary:This study presents a methodology to correctly account for substitution patterns in estimates of final demand used in economic impact analysis. Then, this methodology is demonstrated empirically using recreational tourism data. Specifically, this study a) presents the results of a behavioral model for recreation demand; b) uses the predictions from this model to drive changes in final demand for an input-output economic impact model; and c) presents results from this impact model, contrasting them with the naïve assumption of no/limited substitution. Empirical results indicate that failure to account for substitution in final demand could result in gross overestimates of economic impacts. [PUBLICATION ABSTRACT]
ISSN:1090-4999
2376-5003