The Willingness to Pay for Recreational Services: An Empirical Investigation with the Application of Multivariate Analysis of Two Public Parks in Northern Pakistan
15 Pages Posted: 6 Oct 2008
Date Written: October 6, 2008
The study examines the willingness to pay (WTP) for recreational services of two parks in Northern Pakistan. The data were collected from a sample of 120 respondents in March-April 2001. The study seeks to answer: What factors determine visitors' WTP? Whether improvement in recreational benefits would lead to a higher demand for park visitation with people willing to pay a higher price for better quality of environmental services? In order to understand the determinants of the visitors' WTP responses and to see whether these determinants are consistent with economic theory, a series of multivariate analyses were performed to explore variation in various measures of the respondents' WTP. Travel cost, income, distance, education, and quality of recreational services were significant determinants of WTP. Own-price elasticities of demand were negative in all cases. Cross-price elasticities were positive and significant for both parks showing substitute relationship. Park demand visitation was significantly income elastic for both parks.
Keywords: Willingness to pay, Parks, Multivariate analysis, Pakistan
JEL Classification: Q26, Q51, Q56, A1
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