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The Travel Cost Method: an Empirical Investigation of Randall’s Difficulty
Author(s) -
Common M.,
Bull T.,
Stoeckl N.
Publication year - 1999
Publication title -
australian journal of agricultural and resource economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.683
H-Index - 49
eISSN - 1467-8489
pISSN - 1364-985X
DOI - 10.1111/1467-8489.00090
Subject(s) - unobservable , recreation , observer (physics) , economics , meaning (existential) , welfare , estimation , econometrics , operations research , computer science , mathematics , psychology , market economy , physics , political science , law , psychotherapist , management , quantum mechanics
Randall (1994) argued that the Travel Cost Method (TCM) cannot generate monetary measures of recreation site benefits for use in Cost Benefit Analysis. Randall argues that what is relevant to recreational decision‐making is the subjective, and unobservable, price of travel, whereas TCM uses the observer‐assessed cost of travel. Hence, TCM can at best give ordinally measurable welfare estimates. ‘Randall’s Difficulty’ is formulated as an estimation problem and results are derived for that problem. The meaning of, prospects for, and usefulness of ordinal measurement are explored, and the existence of a solution to Randall’s Difficulty is considered.