Table of Contents
The use of beach as an outdoor recreational outlet has gained tremendous focus of researchers over the years. For instance a perusal of relevant UK and international literature indicate that studies on water related recreation occupies the first position among nature endowed recreation resource (Scarpa, 2003). Travel cost method as a valuation method has been applied extensively to estimate economic use values associated with ecosystems or sites that are used for recreation in many parts of the world. It was first introduced by Hotelling (1947) in his letter to the Director of the National Parks Service in which he proposed a way of estimating the benefits of national parks to the society. He expressed that the fact that people come visiting a park means that the service of the park worth the cost expended, and this cost can probably be estimated with fair accuracy. The theory underlining TCM and its application is grounded in the microeconomic theory of consumer behavior. An individual consumer maximizes his utility derived from the consumption of goods and services subject to his budget constraint (Gravelle and Rees, 2004).
The need to determine the value a beach as a natural resource could be to estimate the changes in cost associated with access to a recreation site, decision to eliminate an existing recreational site, development or improvement of a new site, access changes in environmental quality of a recreation site, among others. While market valuation techniques can be employed to determine value of goods that are traded in market, they are unsuitable to capture the subsistence use and non-use value of natural resources because these are not traded in market. Thus, non-market techniques such as travel cost method (TCM), hedonic price model (HPM), contingent valuation (CV) approach among others have been developed and applied to take care of the shortcoming inherent in market based techniques.
The basic concept of the TCM holds that cost associated with travel time and expenses incur by people while visiting a place represent the access price to the place. This therefore implies that people reflect their willingness to pay for a recreational site by the amount of money and time they spent to visit the site (Limaei, Ghesmati,RashidiandYamini2014). A number of studies (……) have applied TCM to determine the recreational value of beaches. In this study we used the TCM to estimate the use value of Elegushi Beach, at Lagos – Nigeria. The beach which literally has no off season provides enough fun to the visitors thus making it a center of attraction to both old and young. The remaining parts of this article are structured as follows: the next (section two) review empirical studies on TCM. Section three is devoted to the description of the study area, procedure for data collection and description of method of analysis. The forth section presents the results and discussion of findings form the research. Finally, the closing section contains the recommendation, statement on the policy implications of the study and conclusions.
Economists developed the TCM in order to access the economic value of natural resources which market is handicapped to price. With exception of the value of time spent while on journey, economists consider the use of TCM as appealing because of the ease of obtainingits data requirements (Loucks, Erekson, Bol, Gorman, Johnson, and Krehbiel, 1998). The method is hinged on consumers’ willingness to pay infer from actual behavior rather than hypothetical situation.
Literature on the use and application of TCM in valuation of recreational sites abound in developed economies and developing economies. Okojie and Orisajimi (2010) applied TCM in the valuation of Old Oyo National Park, Nigeria to explore the recreation benefits associated with ecotourism via individual observation estimation. The study found that the average representative visitor’s estimates of loss of access to the park was N22.00 per day per visit and N26,400 for all the sampled respondents. The study further observed that the value of recreational use of the park is higher than the value of many economic activities around the park.
Chen, Hong, Liu, Zhang, Hou and Raymond (2003) applied TCM to evaluate the recreation and economic value of Xiamen Island in China. The study which was conducted during summer months of 1999 as an on-site survey on the beach along the eastern shore of Xiamen found that the total value for the beach and itsassociated recreation is in excess of US$53 million.Although, they described the decision of the government to declare tourism and recreation as a dominant function of the area as a laudable programme, lack of effective management andprotection of the coastal environment would lead to reduction in number of visitors and shortened visits and consequently substantial loss in value.
Twerefou and Ababio (2012) assessed the economic value of Kakum National Park, Ghana to recreationists which attracts visitors from fifteen countries. The park serves as home to endangered species such as yellow-backed duiker, forest elephant, and bongo. It houses many reptiles, birds, amphibian, mammals, insects and butterfly species.They employed regression analysis using the zero-truncated negative binomial method to estimate the economic value of the site using ITCM approach. The results of the study indicate that the value of the park in about US$ 46.40 per annum. This translates to aggregate value of US$5,849,416 as at 2009.
The application of TCM has attracted some critiques. It has been noted that it does not adequately estimate the incremental changes in quality and value of natural resource which may take considerable many years before catching the public awareness and adjust their level of consumption accordingly (Loucks et al, 1998). Carr and Mendelsohn (2003) noted the discrepancies between the price that visitors state they paid to get to a site and the price that a travel agent quotes for a low cost visit from their country and consider the cost reported by the visitor as being realistic and representative. Koundouri, Rault, Pergamalis, Skianis, and Souliotis (2015) highlighted sample selection bias which results from not taking into consideration non travelers. Also, is the adoption of wage rate for the price of time as well as attributing negative utility with time of traveling; however, travellers can gain some utilities through sighting some nice scenery while on journey.Christie (2012) envisaged potential issues that might impede application of TCM in developing economies to includemeans of calculating the costs of travel if people trek or cycle to recreation site; and how to estimate the value of time in a subsistence economy. Nijkamp, et al., (2006) argued that values obtained from TCM only capture use value of the resource; thus limiting its strength to estimating the lower bound estimate of the value of a particular biological resource. Its results thus have to be supported with the application of other valuation method to provide the total economic value of biodiversity in a particular location to be relevant for policy formulation.
The Study area
Generally, Lagos has been described as the economic focal point of Nigeria. However, the megacity also provides many natural sites for recreation among which is Elegushi beach, on Lekki peninsula, Lagos. Itis a private beach which is located at Ikate Elegbushi bus stop, a 2km drive from the Lekki toll off Lekki/Epe Express way. The Latitude and Longitude of Elegushi Beach Road is 6.4302577 and 3.5088877 respectively. It is a hot, sandy, beautiful oasisand one of the most patronized beaches with large crowd of visitors on a daily basis. Apart from beautifulscenery of the sea, the beach provides atmosphere for relaxation, picnics, horse riding, beach volleyball, bars, pubs, restaurants, party arenas, lounges, to mention a few. Access to the beach is currently charge at N1,000 (One thousand Naira per person) and a car parking is charged at N200 (Two hundred Naira per vehicle).
Methodology and Data Source
Data requirement for the application of TCM could be obtained from zonal and individual observation. The individual travel cost models (ITCM) are however, preferred to the zonal travel costmodel (ZTCM) in that the former accounts for individuals’ recreation demand functions by observing the rate of visitation of individuals to the facility as a function of travel cost (Das, 2013). ZTCM has been highly criticized due to its vagueness; thus economists and researchers now prefer ITCM instead. Bell and Leeworthy (1990) considers ZTCM as statistically inefficient because it aggregates data obtained from large number of individual observations into a few zonal observations. This study therefore adopted ITCM approach to model the value of the subject beach –Elegushi Beach Lagos.
The TCM simple model as adopted by Mohammed, Moukrim and Benchakroun (2013), Pak and Turker (2006), Bateman (1993), is a survey technique usually estimated as a trip generating function (tgf) as follows:
V=f (C, X) (1)
V, Number of visits to a recreation site;
C, costs per visit;
X, other socio-economic variables, which significantly explain V.
Considering individual travel cost for individual to the beach and the number of visit per period, the equation 1 can be rewritten as:
Vij = f (Cij, Xi) (2)
Vij: Number of visits made per year the individual i to recreation site j;
Cij: visit cost by the individual i to recreation site j;
Xi: all other socio-economic variables determining individual I’s visits.
The demand curve produced by the ITCM relates individual’s annual visits to the costs of these visits. Integrating under this curve gives us the individual consumer surplus (ICS). Multiplying the estimates of ICS by the number of individuals visiting the site annually helps to estimate the consumer surplus for the recreational site, i.e.
Total consumer surplus
Where, Nj is the number of individual visits to recreation site j per year,
Cij and Xi are as defined as in Equation 2 (Bateman, 1993).
Willis and Garrod (1991) proposed another way to calculate Individual consumer surplus. This is to use the following formula for the semi-log function:
CS = – 1/βij (4)
Where, CS is the consumer surplus per person trip and
βij is the coefficient of travel cost Cij.
The total annual consumer surplus obtained from the recreation site can thus be calculated by multiplying the ICS with the number ofvisits made in a year.
The study is a single site model. Single site models are useful when the goal is to estimate the total use or access value of a site (George R Parsons). Visits to Elegushi beach was conducted over a continuous period of four weeks: first week of June, second week of July, third week of August and fourth week of September 2015. This is to vary the category of visitors included in the survey.