Sea-Level Rise, Drinking Water Quality and the Economic Value of Coastal Tourism in North Carolina

John Whitehead, William P. Anderson, Jr, Dennis Guignet, Craig Landry and O. Ashton Morgan

No 24-01, Working Papers from Department of Economics, Appalachian State University

Abstract: We estimate economic benefits of avoiding reductions in drinking water quality due to sea level rise accruing to North Carolina (NC) coastal tourists. Using stated preference stated preference methods data with recent coastal visitors, we find that tourists are 2%, 8%, and 11% less likely to take an overnight trip if drinking water tastes slightly, moderately, or very salty at their chosen destination. The majority of those who decline a trip would take a trip to another NC beach without water quality issues, others would take another type of trip, with a minority opting to stay home. Willingness to pay for an overnight beach trip declines with the salty taste of drinking water. We find evidence of attribute non-attendance in the stated preference data, which impacts the regression model and willingness to pay for trips. Combining economic and hydrology models, annual aggregate welfare losses due to low drinking water quality could be as high as $401 million, $656 million and $1.02 billion in 2040, 2060 and 2080. Key Words: Attribute non-attendance, barrier-island aquifers, sea-level rise, stated preference, tourism

Date: 2024
New Economics Papers: this item is included in nep-env and nep-tur
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