Travel cost method

transcript

APPLICATION OF TRAVEL COST METHOD

SAIDPUR VILLAGE

ABSTRACT

Find the monitory value of a non-marketed

commodity

Application of Travel Cost Method

Main purpose of

this research

ABSTRACT

• One of the favorite picnic place in Islamabad

• Situated on the slope off Margalla Hills

• One of the oldest villages of Pakistan

• Questionnaire survey • Data was analyzed• The willingness to pay • Demand curves

INTRODUCTIONSAIDPUR VILLAGE: AN OVERVIEW

• Situated on the slopes of Margalla Hills • Oldest villages of Pakistan• Known for its heritage, history and folklore• Major tourist attractions • Local and foreign visitors • Signs of a contrasted culture

RESTAURANTS

DES PARDES

THE POLO LOUNGE

Café 99

ANDAAZ

HINDU TEMPLES AND GURDWARA

TRAVEL COST METHOD

• The travel cost method (TCM) was first represented by Hotelling (reported in Prewitt, 1949)

• It is used to value sites that are used for recreation, though it can be used for any “destination” that is used as an amenity.

METHODOLOGY

FIELD SURVEY OF VISITORS

• The information was collected by conducting an on-site survey of visitors to the Saidpur Village by designing the questionnaires.

• A sample size of 10 was selected

• It asked about the visitors, mode of transportation used, travel expenses, miscellaneous expenses at the site, income group, time spent at the village and other data required for the travel cost analysis

MODE OF TRANSPORTATION USED BY VISITORS OF SAIDPUR VILLAGE:

DATA ANALYSIS

INCOME GROUPS OF VISITORS TO SAIDPUR VILLAGE

In our questionnaires, we asked the visitors to choose from among the three income ranges to which they belong. These are:o < Rs.10, 000/-o 10,000-30,000/-o >30,000/-

<10,000

10,000-30,000

>30,000

0 1 2 3 4 5 6 7 8

No.of Visitors

Income in rupees

People prefer other recreational sites more than the Saidpur village

Preference of Substitute SitesNo Yes

90% of the visitors were visiting the site only for the sake of recreation while just 10% were there for

some other purpose.

Purpose of VisitRecreation Other

Visitor Distance Travelled(km)

Fuel Cost for Distance travelled (Rs.)

Entrance Fee (Rs.)

Total Travel Cost (Rs.)

A 48 2000 0 2000

B 50 2100 0 2100

C 28 1000 0 1000

D 150 3000 0 3000

E 20 700 0 700

F 24.1 800 0 800

G 160 3100 0 3100

H 200 4000 0 4000

I 9 250 0 250

J 48 2000 0 2000

ESTIMATION OF TRAVEL COST

TOTAL TRAVEL COST PER YEAR

Visitor Fuel Cost per visit No. of visits per year Total travel cost per year (Rs.)

A 2000 5 10,000

B 2100 6 12,600

C 1000 1 1000

D 3000 1 3000

E 700 6 4200

F 800 6 4800

G 3100 4 12,400

H 4000 6 24,600

I 250 1 250

J 2000 3 6000

ESTIMATION OF TIME COST

We can determine the time cost by knowing the earning of an individual during the time which he/she is spending in their visit to the recreational site.

Suppose: Earning in 23 days (Excluding holidays) = Rs.10,000/-So, earning in 1 day = 10,000/23 = Rs.434/-So, if a person works 8 hours daily in working days, his income per hour will be = 434/8 = Rs.54/-

ESTIMATION OF TIME COST

Visitor Time for round trip(hours/min)

Time spent at site (hour/min)

Total Time consumed(hour)

Monthly Income (Rs.)

Income per hour(Rs.)

Time Cost= income per hour*total time consumed(Rs.)

A 1 1 2 ≥30,000 163 326

B 2 3 5 20,000 108 540

C 40 min 2 2hr40min ≥30,000 163 165

D 2 1 3 ≥30,000 163 489

E 30 min 45 min 1hr15min 20,000 108 135

F 2 30 min 2hr30min ≥30,000 163 407

G 30 min 30 min 1 ≥30,000 163 163

H 4 2 6 ≥30,000 163 978

I 40 min 2 2hr40min ≤10,000 54 144

J 55 min 1 1hr55min ≥30,000 163 312

TOTAL WILLINGNESS TO PAY

• In economics, the willingness to pay (WTP) is the maximum amount a person would be willing to pay, sacrifice or exchange in order to receive a good or to avoid something undesired, such as pollution.

• It can gives us the estimation of money value of a specific recreational site.

• We can calculate the total willingness to pay for each questioned visitor simply by adding up the amounts of travel cost per visit, time cost per visit and miscellaneous expenses.

WILLINGNESS TO PAY = TRAVEL COST + TIME COST + MISCELLANEOUS EXPENSES

Visitor Travel cost per visit(Rs.)

Time Cost per visit (Rs.)

Total Miscellaneous Expenses (Rs.)

Total Willingness to Pay (Rs.)

5000 5512

2000 2585

3000 3358

D 13,500

1500 15120

F 216.9

0 316.9

G 1440

1000 2480

H 1800

5000 7040

1500 1687

J 432 77 4000 4509

DEMAND CURVES

Relation between Number of Visits per Year and Travel Cost per Year for Each visitor

0 5000 10000 15000 20000 25000 300000

Cost per Year

Relation between Number of Visits per Year and Monthly Income for Each Visitor

0 1 2 3 4 5 6 70

10,000

15,000

20,000

25,000

30,000

35,000

No of Visits per year

Relation between Distance Travelled and Total Time Consumed for Each visitor

0 200 400 600 800 1000 1200 1400 16000

50100150200250300350400

Distance travelled (km)

RESULTS AND DISCUSSIONS

• Most of the visitors use personal vehicle

• Majority of the visitors belonged to high income group

• 60% preferred substitute sites to visit instead of Saidpur village

• No entrance fee

• Recreational purpose only

• People travelling from small distances visited Saidpur Village several times

• Also, visitors with greater income visited the recreational site more

• We determined the total willingness to pay for each of our subject by adding up their travel costs, time cost and miscellaneous cost.

Total Willingness to Pay of our total Sample: Rs.42,988/-

This is only the amount that we calculated from the data obtained from our questioned sample.

CONCLUSION

• Major holiday attraction to the number of people who visit it for the sake of recreation

• The beauty of this attractive site is being forsaken because of lack of cleanliness and waste dumping in open places

• While the entry fee remains is 0 to visit this place, people’s WTP is estimated to be quite large

Travel cost method

Environment