Does economic endogeneity of site facilities in recreation demand models lead to statistical endogeneity?

Min Chen and Frank Lupi

No 49449, 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin from Agricultural and Applied Economics Association

Abstract: Different kinds of endogeneity problems in Random Utility Models of recreation demand have been studied in previous literature. Some site characteristics, like facilities, could be endogenous in an economic sense due to the interplay of supply and demand. That is, it may be that more popular recreation sites tend to have better site characteristics since managers with limited budgets would be more willing to invest in them. If recreation site improvements are more likely to occur at the more popular sites, then might this economic endogeneity cause problems for econometric models linking site demand to facilities. In this paper, we use Monte Carlo simulations to test whether this economic endogeneity will lead to statistical endogeneity.

Keywords: Environmental; Economics; and; Policy (search for similar items in EconPapers)
Pages: 23
Date: 2009
New Economics Papers: this item is included in nep-env and nep-tur
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea09:49449

DOI: 10.22004/ag.econ.49449

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