The travel cost method: an empirical investigation of Randall’s Difficulty
Common, M., Bull, T., and Stoeckl, N. (1999) The travel cost method: an empirical investigation of Randall’s Difficulty. Australian Journal of Agricultural and Resource Economics, 43 (4). pp. 457-477.
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Randall (1994) argued that the Travel Cost Method, TCM, cannot do what it is supposed to do ¾ generate monetary measures of recreation site benefits for use in Cost Benefit Analysis. Randall argues that what is relevant to recreational decision making is the subjective, and unobservable, price of travel, whereas TCM uses the observer-assessed cost of travel. Hence, TCM can at best give ordinally measurable welfare estimates. In this paper, ‘Randall’s Difficulty’ is formulated as an estimation problem and results are derived for that problem. A survey data set and Monte Carlo simulations are used to illustrate and quantify Randall’s Difficulty. The meaning of, prospects for, and usefulness of ordinal measurement are explored, and the existence of a solution to Randall’s Difficulty is considered.
|Item Type:||Article (Refereed Research - C1)|
|Keywords:||travel cost method, welfare estimates, cost measurement, ordinality|
|FoR Codes:||14 ECONOMICS > 1402 Applied Economics > 140205 Environment and Resource Economics @ 100%|
|SEO Codes:||91 ECONOMIC FRAMEWORK > 9102 Microeconomics > 910299 Microeconomics not elsewhere classified @ 100%|
|Deposited On:||12 Nov 2010 12:25|
|Last Modified:||12 Feb 2011 19:17|
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