Valuing Access to our Public Lands: A Unique Public Good Pricing Experiment

We report the findings of a unique nation-wide experiment to price access to our public lands. In 2004, the U.S. Federal Lands Recreation Enhancement Act mandated the creation of a new annual pass to cover all federal recreation sites that charge an entrance or access fee. Our task was to assist federal policymakers in determining an appropriate price for this new pass. Toward that end, we administered a contingent valuation phone survey to over 3700 households to estimate households’ willingness to pay (WTP) for the new pass at a variety of different prices. Our innovative experimental design allows us to estimate the degree of hypothetical bias in the sample and calibrate our WTP estimates to reflect actual purchasing decisions. In a sample of the general U.S. population – most of whom have little experience with similar federal passes – respondents tend to greatly exaggerate their WTP for the pass when contrasted with previous pass sales. A sample of recent pass purchasers, however, exhibits little bias. This confirms recent research showing that market experience can be an effective means to mitigate hypothetical bias.