Economic evaluation of recreation - comparison of the travel cost model (TCM) and the contingent valuation method (CVM)

Abstract

Tourism that takes place in nature sites benefits from the fact that nature is considered to be a public good. There is no fee charged for being in nature and using nature for recreational purposes. Prevailing nature-based tourism destinations are admission free. To evaluate the economic value of recreation, various methods for valuation of environmental goods are commonly used. The most widely used methods are the travel cost method and contingent valuation method. This paper focuses on comparison of these two methods. It discusses tourists’ travel costs to get to a nature-based destination. It studies direct costs to get to a destination place and related indirect costs, including the time costs. To measure the economic value by using the contingent valuation approach, the Willingness-to-pay method is used. The Willingness-to-pay method measures the consumer surplus tourists have from their recreation (indirect economic value). The direct economic value is measured by expenditures incurred by tourists in the destination place. The comparison of both the approaches is applied to the tourists´ survey data collected in a prime nature-based destination – National Park Podyji.