RT Journal Article
SR Electronic
T1 Lost Use-Value from Environmental Injury When Visitation Drops at Undamaged Sites
JF Land Economics
JO Land Econ
FD University of Wisconsin Press
SP 87
OP 96
DO 10.3368/le.94.1.87
VO 94
IS 1
A1 Garrett Glasgow
A1 Kenneth Train
YR 2018
UL http://le.uwpress.org/content/94/1/87.abstract
AB We describe welfare calculations when an environmental injury reduces trips to undamaged sites as well as those that were damaged. The welfare loss is (1) underestimated when standard welfare formulas are applied only to damaged sites but (2) overestimated when these formulas are applied to all sites with lost trips. We provide a formula that appropriately accounts for the lost trips to undamaged sites. Differences among the procedures are illustrated through hypothetical scenarios that differ in lost trips to undamaged sites. We apply the method under linear demand to aggregate estimates of shoreline-use losses from the Deepwater Horizon oil spill. (JEL D61, D81)