Price Elasticity Of Demand: A Campground Example

Abstract

This study was undertaken to estimate price elasticity of demand for campgrounds within the Canadian Parks Service. However, as research proceeded, it became clearthata systematic factor was disrupting attempts to accurately estimate elasticity of demand. A critical step in the analysis was the identification of a feeder effect, which represents the interaction between a campground operating at full capacity and its associated camp grounds which are not operating at full capacity and which take the overflowfrom thefull campground. A key finding in the study was that feeder campgrounds can be drastically affected byfee increases. Aprice elasticity ofdemand model wasformulated to incorporate a measure for the feeder effect and the model was tested. Theresultsofthisstudypointtothe additional parameters and further research which would be required to provide valid models to estimate elasticity of demand.

Get full access to this article

View all access options for this article.

References

Beaman, Jay , Kim Y. , and S. Smith (1979). "The Effect of Recreation Supply on Participation ." Leisure Sciences, 2 (1)

Calantone, R.J. , C. S. di Benedetto , and D. Bojanic (1987). "A Comprehensive Review of the Tourism Forecasting Literature." Journal of Travel Research, 26, (Fall): 28-39.

Canadian Parks Service (1976). Canadian Outdoor Recreation Demand Study, 2. Technical Notes. Available through interlibrary loan at most Canadian university libraries and the Chaudiere Branch, Departmental Library, Environment Canada, Ottawa, Ontario, K1A 0H3.

-Annual Statistical References, 1981-1986. Available through interlibrary loan at most Canadian university libraries and the Chaudiere Branch, Departmental Library, Environment Canada, Ottawa, Ontario , K1A 0H3.

Cesario, Frank J. (1975). "A New Method for Analyzing Outdoor Recreation Trip Data "Journal of Leisure Research, 7: 200-15.

Cesario, F.J. , J.E. Goldstone , and J.L. Knetsch (1969). A Report on Outdoor Recreation Demand Values to the Middle Atlantic Unity Group. Columbus: The Batelle Memorial Institute.

Cheung, H.K. (1972). "A Day-Use Park Visitation Model." Journal of Leisure Research, 4: 139-56.

Coursey, Don , and Hans Nyquist ( 1988). "Application ofRobust Estimation Techniques in Demand Analysis." Applied Economics, 20: 595-610.

Ellis, J.B. , and C. Van Doren (1966). "A Comparative Evaluation of Gravity and Systems Theory Models for State-Wide Recreation Flows." Journal of Regional Science, 6: 57-70.

10.

Ewing, Gordon O. (1980). "Progress and Problems in the Development of Recreation Trip Generation and Trip Distribution Models." Leisure Sciences 3: 1-24.

11.

Fesenmaier, Daniel R (1988). "Integrating Activity Patterns Into Destination Choice Models." Journal of Leisure Research, 20: 175-91.

12.

Gaudry, Marc J. J. , and J. Michael Wills (1978) "Estimating the Functional Form of Travel Demand Models," Transportation Research, 12: 257-89.

13.

Goodchild, Michael (1976). "The Meaning of R2 in Using Analysis of Variance to Explain Participation in Recreation Activities." Canadian Outdoor Recreation Demand Study, 2. Technical Note 36 Ottawa: Canadian Parks Service. Available through interlibrary loan at most Canadian university libraries and the Chaudiere Branch, Departmental Library, Environment Canada , Ottawa, Ontario, K1A 0H3.

14.

Gum, Russel L. , and William E. Martin (1977). "Structure of Demand for Outdoor Recreation." Land Economics, 53 (1): 43-55.

15.

Ramsey, J.B. , and P. Schmidt (1976). "Some Further Results on the Use of OLS and BLUS Residuals in Specification Error Tests." Journal of the American Statistical Association, 71: 389-90.

16.

Skjei, Stephen S. (1977). "Identification in the Estimation of Recreation Demand Curves from Cross-Section Data: How Important Is It?" (plus communications), Journal of Leisure Research, 9: 301-17.

17.

Uysal, M. , and J.L. Crompton ( 1986). "An Overview of Approaches Used to Forecast Tourism Demand ." Journal of Tra vel Research, 23, ( Spring): 7-15.