Aggregation in Recreation Economics: Issues of Estimation and Benefit Measurement

Abstract

Problems of aggregation plague applications of microeconomics. The theory is derived from postulates of behavior of individuals, but we often have data only for groups of individuals. The economics of outdoor recreation is no exception. This paper addresses the aggregation issue for estimating the demand for outdoor recreation. What are the estimation and welfare implications of using individual vs. aggregated observations, if the latter is all we have?