A Two-Constraint Almost Ideal Demand Model of Recreation and Donations

An incomplete demand system is developed for recreation and donation choices, subject to both money and time constraints. The model results in a three-good system, with an endogenous marginal value of time for estimation. The model is implemented by adapting Deaton and Muellbauer's locally flexible almost ideal demand system to a two-constraint recreation model of trips and donations of California whale watchers. Exact welfare measures are calculated for changes in costs, as well as for whale population changes. Results indicate a use and a nonuse component of overall willingness to pay for increases in environmental quality. © 2003 President and Fellows of Harvard College and the Massachusetts Institute of Technology.