Recreation planning as an economic problem

Abstract

We are confronted on all sides these days with projections showing the immense scale of our future needs for outdoor recreation. There can be little doubt that in the coming years many millions of dollars will be invested in space and facilities for outdoor recreafion-many more millions than have been invested in the past. Much of this, as in the past, will be public investment. We have a right to wonder if these immense quantities of new funds will be allocated among alternative recreation facilities in a way leading to the highest achievable social satisfaction. Assuming that society knows how much of a limited public budget it wants to assign to outdoor recreation development, the question is whether the agencies in charge of spending the funds can allocate them with optimal results. The answer depends on how well the decision makers can perceive the values to society of different amounts and kinds of recreation areas and facilities. In a market economy the market process serves as an information medium in transmitting to producers the qualitative and quantitative desires of consumers; these desires influence, in turn, the variety and amount of products marketed. Where public expenditures produce consequences having value in the market , money measures of value are used to express the social values of the end products of the expenditure. In such cases primary benefits of an expenditure are the beneficiaries' willingness to pay for its immediate consequences. Conceptually , each beneficiary will pay an amount not exceeding the value of the project to him. Total project benefits are the beneficiaries' willingness to pay summed over all beneficiaries. The burden of this exposition is that market measures of project evaluation, as summarized in benefit-cost analysis, are the most useful of ranking functions for most classes of recreation planning problems. Use of this efficiency ranking function is stymied by a virtual absence of ready-made market prices, but this need not dissuade us from attempting to approximate market indicators. The remainder of this article will discuss the virtues and uses of economics in recreation planning and suggest some approaches to getting needed data. Economics is useful at all levels of choice, from allocating the total share of public funds to recreation programs or choosing kinds and locations of areas, down to detailed decisions about developing a particular recreation tract. We O Resources for the Future, Inc. The opinions expressed in this article do not necessarily reflect those of the organization. Some helpful comments were made by Jerry Milliman and Jack Knetsch on an earlier draft.