Valuing water quality as a function of water quality measures

Kevin J. Egan, Joseph A. Herriges, Catherine L. Kling, John A. Downing

Research output: Contribution to journalArticlepeer-review

81 Scopus citations

Abstract

Employing a unique and rich data set of water quality attributes in conjunction with detailed household characteristics and trip information, we develop a mixed logit model of recreational lake usage and undertake thorough model specification and fitting procedures to identify the best set of explanatory variables, and their functional form for the estimated model. Our empirical analysis shows that individuals are responsive to the full set of water quality measures used by biologists to identify the impaired status of lakes. Thus, changes in these quality measures are not simply a scientific exercise, but they also translate into changes in the recreational usage patterns and well-being of individual households. Willingness-to-pay (WTP) estimates are reported based on improvements in these physical measures.

Original languageEnglish (US)
Pages (from-to)106-123
Number of pages18
JournalAmerican Journal of Agricultural Economics
Volume91
Issue number1
DOIs
StatePublished - 2009
Externally publishedYes

Bibliographical note

Funding Information:
The authors would like to thank participants in seminars at Resources for the Future, the University of Minnesota, and the Heartland Conference for helpful comments on earlier drafts of this paper. All remaining errors are, of course, our own. This journal paper of the Iowa Agriculture and Home Economics Experiment Station, Ames, Iowa, Project No. 5141, was supported by Hatch Act and State of Iowa funds. Funding for this project was also provided by the Iowa Department of Natural Resources and the U.S. Environmental Protection Agency’s Science to Achieve Results (STAR) program. Although the research described in the article has been funded in part by the U.S. Environmental Protection Agency’s STAR program through grant R830818, it has not been subjected to any EPA review and therefore does not necessarily reflect the views of the Agency, and no official endorsement should be inferred.

Keywords

  • Nonmarket valuation
  • Recreation demand
  • Water quality

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