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Functional Form and Welfare Measures in Truncated Recreation Demand Models
Author(s) -
Ozuna Teofilo,
Jones Lonnie L.,
Capps Oral
Publication year - 1993
Publication title -
american journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.949
H-Index - 111
eISSN - 1467-8276
pISSN - 0002-9092
DOI - 10.2307/1243990
Subject(s) - recreation , truncation (statistics) , econometrics , valuation (finance) , welfare , economics , economic surplus , sample (material) , statistics , mathematics , ecology , biology , market economy , finance , chemistry , chromatography
This article examines the effect on welfare measures of functional form choice and sample truncation. A truncated general Box‐Cox model is developed for discriminating between alternative truncated functional forms. The model is applied to the valuation of three Texas coastal recreation sites. Neither the truncated double‐log nor the truncated semilog forms are appropriate for the truncated data used in the empirical analysis. Different functional forms yield different consumer's surplus estimates when samples are truncated.