A ‘Quick and Dirty’ Travel Cost Model

Abstract

This paper describes a series of Monte-Carlo simulations that investigate the accuracy of welfare estimates generated from the travel cost model (TCM). The simulations indicate that in some cases the TCM can generate reasonably accurate welfare estimates – even when researchers are unable to determine the correct price of all recreational inputs or the correct way to allocate the joint costs of multiple-site visitors. This means that in some circumstances researchers may be able to estimate a visitation equation simply, using an implied price of distance equal to one and then scaling final estimates for a range of different ‘plausible’ prices. These final estimates are neither better nor worse than other estimates, but they are considerably simpler to generate, thus saving time that can then be devoted to the many other problems attending TCM implementation.