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Investigating the effects of sample heterogeneity on the travel cost model for coral diving in Southeast Asia

Amar Doshi and Sean Pascoe

No 152146, 2013 Conference (57th), February 5-8, 2013, Sydney, Australia from Australian Agricultural and Resource Economics Society

Abstract: In mid-2010, an impact assessment was undertaken to ascertain the non-market value of coral reefs to scuba divers in Thailand, Malaysia and Indonesia. A travel cost method was employed and it was found that divers had a consumer surplus of about US$590 per dive. However, given the sample consisted of a much larger proportion of international visitors (84%), an analysis was undertaken to ascertain the effects of the sample heterogeneity on the economic value estimates. The results indicated that the pooled results were biased towards the international sub-sample. Domestic visitors had a much lower consumer surplus of about US$130 per dive. In addition, the split-sampling suggested that the assumption of endogenous stratification using count data models was not appropriate for the international sub-sample. Applying the split-sampling based to the three separate countries illustrated further large disparities in consumer surplus, with Thailand the highest at US1200 per dive and Malaysia the lowest at US$260 per dive. This proves consequential in determining the appropriate user fee structure given the different resulting effects on returning divers based on their origins and diving destinations.

Keywords: Demand and Price Analysis; Environmental Economics and Policy; Research and Development/Tech Change/Emerging Technologies (search for similar items in EconPapers)
Pages: 24
Date: 2013-02
New Economics Papers: this item is included in nep-cwa, nep-env, nep-sea and nep-tur
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DOI: 10.22004/ag.econ.152146

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