Recreation Demand Functions and the Identification Problem

Abstract

This article discusses the identification problem which arises in estimating recreation demand functions. The importance of using structural demand equations rather than reduced form equations and user response models to obtain information for making rational public decisions on recreation policy is emphasized. The factors which have complicated the identification of structural demand equations in studies of outdoor recreation are discussed and a possible solution to the problem presented. It is suggested that a traditional market type of demand equation be estimated for each activity rather than one which is site specific. Because of the special nature of costs associated with participation in outdoor recreation activities and the spatial distribution of recreation facilities, derivation of such a model using individual cross sectional data provides both a feasible and an appropriate solution to the identification problem.