Measuring the Economic Benefits of Saginaw Bay Coastal Marsh with Revealed and Stated Preference Methods

We estimate the economic benefits of Saginaw Bay coastal marsh with the travel cost and contingent valuation methods. The travel cost method is based on revealed preferences: actual recreation behavior. Using a sample of the general population of Michigan and Michigan hunting and fishing license holders we find that Saginaw Bay recreation site selection is negatively related to travel cost and positively related to wetland acreage. The contingent valuation method is based on stated preferences: answers to hypothetical survey questions. We find that willingness-to-pay is negatively related to marsh protection cost and positively related to income and environmental organization membership. Using a combination of theory and empirical results we argue that revealed and stated preference methods are complementary when estimating the total value of coastal marsh. The present value of each acre of coastal marsh is $1870 for the purpose of recreation. The present value to recreation nonusers adds $551 per acre. The total present value of each acre of coastal marsh could be as high as $2421