Ju Rn 1,I 197Z the AGRICULTURAL ADJUSTMENT UNIT the UNIVERSITY of NEWCASTLE UPON TYNE

AGRICULTURAL ADJUSTMENT UNIT • UNIVERSITY OF NEWCASTLE UPON TYNE

OtANNINI JNDATtON AGRICULTU ...CONOMICS Li E3RAQ, , e .

,jU rN 1,i 197Z THE AGRICULTURAL ADJUSTMENT UNIT THE UNIVERSITY OF NEWCASTLE UPON TYNE

In recent years the forces of change have been reshaping the whole economy and, in the process, the economic framework of our society has been subject to pressures from which the agricultural sector of the economy is not insulated. The rate of technical advance and innovation in agriculture has increased, generating inescapable economic forces. The organisation of production and marketing, as well as the social structure, come inevitably under stress. In February 1966 the Agricultural Adjustment Unit was established within the Department of Agricultural Economics at the University of Newcastle upon Tyne. This was facilitated by a grant from the W.K. Kellogg Foundation at Battle Creek, Michigan, U.S.A. The purpose of the Unit is to collect and disseminate information concerning the changing role of agriculture in the British and Irish economies, in the belief that a better understanding of the problems and processes of change can lead to a smoother, less painful and more efficient adaptation to new conditions.

Publications To achieve its major aim of disseminating information the Unit will be publishing a series of pamphlets, bulletins and books covering various aspects of agricultural adjustment. These publications will arise in a number of ways. They may report on special studies carried out by individuals; they may be the result ofjoint studies; they may be the reproduction of papers prepared in a particular context, but thought to be of more general interest. The Unit would welcome comments on its publications and suggestions for future work. The Unit would also welcome approaches from other organisations and groups interested in the subjects of agricultural adjustment. All such enquiries should be addressed to the Director of the Unit.

Unit Staff Director: Professor J. Ashton, M.A., B.Litt, M.S. Head of Unit: Professor S.J. Rogers, B.Sc.(Econ) Administrative Officer: B. H. Davey, B.Sc.(Agric), M.Econ The Agricultural Adjustment Unit, Department of Agricultural Economics, The University, Newcastle upon Tyne, NE1 7RU. RECREATION BENEFITS FROM A RESERVOIR

A CASE STUDY BY R. C. LEWIS AND M. C. WHITBY

Research Monograph No. 2

AGRICULTURAL ADJUSTMENT UNIT UNIVERSITY OF NEWCASTLE UPON TYNE 1972 PREFACE

In the course of developing its understanding of the processes of agricultural adjustment, the Agricultural Adjustment Unit has become increasingly aware of the relevance of non-farm aspects of the subject. On the one hand there is a range of issues involving rural communities and their future development. These considerations include changes in population and its structure, changes in incomes in rural areas, problems regarding the provision of social services and public utilities and the whole political and social relationship of rural communities to the urban majority. On the other hand there are a number of questions regarding resource use, where economic activities alternative to agriculture need to be evaluated in terms of their economic and social consequences. Thus the development of tourism and recreational facilities has come to be a major subject of discussion, possibly only slightly less intense than the more dramatic issues ofconservation and pollution. These areas for debate have two characteristics of interest to the Agricultural Adjustment Unit. Firstly, they involve public decisions, which impinge directly or indirectly on agriculture and farming communities. Secondly, consideration of such issues necessitates difficult judgements regarding the worthwhileness, in a number of senses, of alternative policies. The first major activity of the Agricultural Adjustment Unit in this complex area was the mounting of a Conference at Aviemore, the proceedings of which were published by Oliver and Boyd early in 1972 in a book entitled 'The Remoter Rural Areas of Britain'. This conference generated considerable interest, as a result of which a number of research possibilities were explored. In developing these ideas it quickly became apparent that there would be methodological problems to face before any serious attempt could be made to tackle practical questions in a satisfactory manner. Thus, staff in the Agricultural Adjustment Unit have become increasingly involved on some theoretical issues, which nevertheless have a direct bearing on policy matters. It was decided to publish some of these studies as research monographs, so contributing to the debate at a more theoretical level than hitherto, and therefore producing material likely to be of the greatest interest to • specialist workers in the subjects concerned. The objective of these Research Monographs is to stimulate discussion on the various ways of evaluating problems, demonstrating the techniques by application to a particular subject. This monograph is the second of the series, the first being on 'Models of Population and Income' by Dr. K. G. Willis. The subject is that of the benefits of recreational facilities to the community at large. There are, however, wider questions such as the total recreational requirement of a particular region, the appropriate pricing policies to be adopted, and the impact of such facilities on nearby farming communities which also demand attention. 3 The case study concerns the Derwent Reservoir, located some 20 miles from Tyneside. Recreational facilities were planned at this reservoir from the beginning as a conscious act of policy. There are many technical questions concerning fishing, day-visiting and sailing and their relationship with the primary purpose of the reservoir of providing fresh water. These are not discussed here in any detail, but cannot be overlooked. The emphasis ofthe monograph is on a method of evaluating public benefits by means of a technique which is not beyond discussion. The resultant assessment of public benefits, amounting to some 12,000, per annum, from the three activities, gives an approximate idea of the importance of this type of amenity for an urban population demanding recreational facilities in adjacent rural areas. On its own, however, this is a trivial sum compared with the very large total amounts spent on urban recreation of all kinds, and indeed on all forms of rural recreation. In the course of preparing this paper the research workers concerned have received considerable assistance from a number of statutory and voluntary bodies without which it would not have been possible to have progressed this far. In particular we would like to acknowledge the assistance of Sunderland and South Shields Water Co., who made their fishing records available, the Derwent Reservoir Sailing Club,. whose members responded very generously to our requests for information, and to the Durham County Planning Department who gave us access to survey data on day-visiting at the Reservoir. Constructive comment from colleagues, and in particular from Dr. R.J. Smith, of the Water Resources Board, has improved the work and is gratefully acknowledged. Further studies of resource use and rural community problems are already in hand and will be published in due course. However, the Adjustment Unit would welcome discussions with interested parties, either on the methodological aspects or on particular issues in the field. JOHN ASHTON March 1972

4 RECREATIONAL BENEFITS FROM A RESERVOIR

A CASE STUDY

CONTENTS Page 1. Introduction .. • • • • • • • • .. • • • • • • 7

2. The Theoretical Aspects of Estimating Recreation Benefits • • • • 12

3. The Value of Fishing at Derwent Reservoir • • • • • • • • 16

4. Day-Visiting Benefits at Derwent Reservoir • • • • • • • • 21

5. Sailing at Derwent Reservoir • • .. • • • • • • • • 24

6. Recreation Benefits at the Proposed North Tyne Reservoir .. • • 31

7. Summary and Conclusions • • • • • • • • • • • • 36

Appendix 1. Observed fishing data .• • • • • .• • • • • 40

Appendix 2. Observed day-visiting data .. • • • • .. • • 43

Appendix 3. Membership of the Sailing Club • • • • .. • • 45

Appendix 4. Sailing Club Questionnaire .. • • • • • • • • 47

Appendix 5. Summary of Sailing Survey data .. .. • • • • 49

5 1. INTRODUCTION

The whole question of the environment, in its many facets, has become an increasingly popular subject for debate in recent years. One aspect ofthis is the development of water resources for urban uses; another has been the apparently growing demand by the urban populace for recreational facilities in rural areas. Both of these topics, when reservoirs are being proposed, or exist, impinge directly or indirectly on agriculture and rural communities and here, as elsewhere, the subject of agricultural adjustment embraces a much wider range of issues than that offarming alone. No attempt is made here to cover the full range of topics debated about conflicting interests and public decision-making. This paper deliberately narrows down to one theoretical issue, that of measuring the benefits of recreation. Attention is focussed on the methodological and data problems likely to be encountered, and an attempt is made to clarify some of these points by examining a particular reservoir. The Derwent Scheme was created by the Sunderland and South Shields Water Company and the Durham County Water Board in 1967. The total cost amounted to 8m,of which some 51--in was for the reservoir itself. The reservoir is primarily a source of potable water, capable ofsupplying 25m gallons of water a day, among a population of one million people. The reservoir is situated about twenty miles South-West of Newcastle, and its location and plan are shown in Figures 1 and 2. The recreational potential of the reservoir was recognised prior to construction and the provision of a range of recreational facilities was included in the planning stages. The forecasts were realised—the reservoir has become a popular attraction to residents of the North East of England, and provides a good example of recreational development of water resources. One of the popular activities is angling. The reservoir is stocked by the Sunder- land and South Shields Water Company with brown trout and rainbow trout. Only fly fishing is allowed, and fishing control is exercised by a system of seasonal or daily rod permits. More than 10,000 rod permits have been issued each year since 1967.1 On the opening day of the 1968 season no less than 703 permits were issued and nearly 2,600 fish were taken. Casual day-visitors take advantage of several amenities now provided. There are seven scenic lay-bys, located adjacent to a perimeter road; there are three car parks at the dam itself; there are two picnic areas and one country park.2 Summer week-ends are the most popular times, and it was estimated that at 4 p.m. on Sunday June 21, 1970 there were 2,200 day visitors around the reservoir.3

For further information see `Derwent Reservoir Fishing Regulations',(Sunderland and South Shields Water Company, published annually). 2 Derwent Reservoir Provision for Recreational Facilities, (Durham County Planning Department, Dec. 1966). 3 Derwent Reservoir Visitor Survey, 1970,(Derwent Valley Advisory Committee, March 1971). 7

DERWENT RESERVOIR

KEY

— County Boundary Existing Road .4=6. LaYbY

Nature Reserve •• Prohibited to anglers birdvvatchers and Picnic Area 111 I Area prohibited to boats P Car Park U Utilities building issuing kiosk and toilets

Country Park COUNTY'OF DURHAM

Scale 'A % 1 mile Blanchland 0 Edmundbyers FIG. 2 An additional attraction is a Nature Reserve, located on the Southern shore of the reservoir. It is managed by a committee, which includes representation of the water company, Durham County Conservation Trust, tile Nature Conservancy and the Derwent Reservoir Sailing Club. The Derwent Reservoir Sailing Club was founded in 1967 and its membership is rapidly approaching its planned maximum of 1,000 members. The clubhouse opened in 1969. The premises occupied by the club were provided by the water company which has granted a lease to the club. Several grants have been obtained from the Lepartment of Education and Science, Local Education Authorities and the Butlin Trust. For the most part these have been passed over to the water company, so reducing the net capital outlay and, therefore, the rental charge. The sailing season runs from April to December. On week-days there is sailing for school children organised by Local Education Authorities, through a Schools Sailing Association, which is affiliated to the club. In total then the Derwent Reservoir has provided a range of water-based recreational opportunities, which, over a period offour years, have become very popular with residents of North East England. Taking matters a stage further, two related economic considerations emerge. Firstly reservoir installations are, almost inevitably, financed through the public sector, whether by central or local government, or by a national or regional water authority. In deciding on a rational basis the worthwhileness ofsuch investments it is necessary to take account ofthe full costs ofthe project and also the complete range of benefits,including those associated with secondary uses of the facility such as recreation. Where public funds are not sufficient to finance all projects, inclusion of recreational benefits may alter the predicted benefits or projects enough to change their ranking for selection. Secondly there are some goods and services for which the ordinary competitive market system, of private enterprise supplying in response to profit and individual consumers responding to prices, does not work adequately. That is to say the decision of how much of a good or service is provided cannot be left to private initiative. Obvious examples of this are defence and some types of research and development. Some part of recreation and amenity services may also come into this category. The main reasons for this are twofold. In the first place the provision of the amenity may hinge on major land use or resource allocation decisions well beyond the compass of private businessmen. In the second place it may be difficult, if not impossible, to administer a pricing system;for example how can one charge a tourist for driving through an area of great scenic beauty? It follows that for those aspects ofrecreation not amenable to ordinary market forces, alternative means ofanswering the question 'how much ?' must be found. It is argued here that, at least in principle, an economic evaluation of the demand for recreation and the measure of benefits derived from particular facilities would be a better guide to choice than a purely political decision which may be unduly arbitrary. 10 The primary purpose of the analysis in this monograph is to explore one of the aspects of public resource decisions namely the evaluation of recreational benefits from a particular facility. In particular it explores the use of a specific method of measurement, generally known as the Clawson Method, which is described in the following section, to determine how sensitive the final results are to (a) the mathematical demand function which is employed and (b) data of different quality. The main results of later sections can be anticipated here. In general it may be said that the choice of mathematical function is not critical, given the measurement conventions used, in assessing the level of benefits, but the quality of data may be more important. Following the sections dealing with Derwent Reservoir, there is a brief examination of recreational benefits at the proposed North Tyne Reservoir. It will have become apparent from the foregoing paragraphs that the time to estimate recreational benefits is before a project is undertaken. Once a reservoir is completed analysis may be of historic interest; the decision has been taken and it is too late to influence more than marginal issues. However the main purpose of the section on the North Tyne Reservoir is to demonstrate that a predictive assessment of recreational benefits is possible. More detailed study would be required to generate estimates taking due account of the unique characteristics of this site.

11 2. THEORETICAL ASPECTS OF ESTIMATING RECREATION BENEFITS

The amount of a particular commodity which an individual purchases is influenced not only by its price, but by the prices of other possible purchases, by the consumer's tastes and by his income. Within the limitations of imperfect knowledge the consumer balances his purchases to provide the maximum satisfaction. Should any of the variables influencing his choice change, he will adjust his spending pattern to take account ofthe changed circumstances. The aggregate demand for a commodity by a community is the sum of the individual demands. In the short run, consumer tastes, incomes and the prices of most other goods, may not change significantly, and it is possible to establish a meaningful partial relationship between the quantity of a commodity purchased by a community and its price. This relationship can be estimated statistically if sufficient observations are available of prices and quantities purchased. For some commodities it is necessary to recognise that the actual price paid for the goods is not the only charge the consumer has to bear, since he may also incur travelling expenses and inconvenience. This aspect can be handled by defining 'commodity transfer costs', which are 'those costs incurred by the buyer or seller of goods, but which are not normally included in prices?' Commodity transfer costs can be a large proportion of the total charge borne by consumers of recreational items. Indeed where there is no actual price paid, e.g. where there is free admission to a park, the transfer cost will account for the total charge. Commodity transfer costs on recreational expenditure vary widely between individual consumers, depending on such factors as the location of his home in relation to the location of the recreational facility and the mode of transport he employs to travel to his chosen pursuit. Thus a house near a golf course may com- mand a premium which reflects the saving in commodity transfer cost enjoyed by the resident although only, say, golfers and dog-owners would be prepared to pay it. In circumstances where transfer costs form a high proportion of the total charges incurred by consumers, demand analysis based solely on price would be misleading and the definition of price should be broadened, even though this would increase the volume ofdata required to complete the analysis. The most promising approach2

1 Brown, W.G., Singh, A. and Castle, E. N.,'An Economic Evaluation of Oregon Salmon and Steelhead Sport Fishery' Oregon Agric. Exp. Stn. Tech. Bull. 78.(Cornvallis, Oregon 1964).

2 For discussions of other approaches see: Burton and Noad,'Recreation Research Methods: A Review of Recent Studies,' (University of Birmingham Centre for Urban and Regional Studies, 1968). 'The Demand for Outdoor Recreation' (London: Countryside Commission). 12 to the estimation of demand for recreation is the method suggested by Hotelling' and applied by Clawson,2 referred to here as the Clawson Method. This is based on the notion that the demand for recreation can be derived from a relationship between the average total price (i.e. the price plus transfer costs) and the participation rates (e.g. the number of visitor-days3 per head of population) for a population of consumers who are homogeneous with respect to other determinants of demand. Clawson calls this the demand for total recreational experience. In order to estimate this demand function statistically information is needed about the geographical distribution of consumers with respect to a recreational site. A theoretical approach, which has been proposed, established a geographical model in which the recreational site was located in the centre of a featureless plain and surrounded by a population homogeneous with respect to preferences and disposable income, with common prices for all other commodities. Consequently the difference between recreational expenditure would be due entirely to the different total prices of recreation, which provides a framework within which relevant observations can be made. The featureless plain can be divided into distance zones by a series of concentric circles. The rate of participation in each zone can be derived by dividing the observed number of visitor-days from that zone by its total population. The average total price is the sum of the admission charge and travelling costs, travelling costs being average mileage from the zone multiplied by some overall figure of cost per mile. This procedure provides one price/quantity observation for each zone. These provide a sufficient basis for deriving a recreational demand function for the particular site. This method assumes that one pound spent on admission is the same to the consumer as one imputed pound spent on travel, so that consumers will react to a change in admission price to the same extent that they have already reacted to a difference in imputed travel cost. Under these conditions it is possible to predict a new set of participation levels, which can be aggregated to give a total participation for all zones, for each new admission price, and so to derive a complete demand function for the recreational site.4 An estimate, in terms of a sum of money, can be deduced from the demand function to represent the annual benefit from the recreation site. This is achieved by determining the maximum annual admission revenue which would accrue to a

1 The Economics of Public Recreation, (Washington D.C.: National Park Service, Land and Recreational Planning Division, 1949).

Clawson, Marion 'Methods of Measuring the Demand for and Value of Outdoor Recreation', Reprint No. 10(Washington D.C.: Resources for the Future Inc., Feb. 1959).

A visitor-day is defined as one person visiting a site for any part of one day.

4 For a simple numerical example of this procedure see: Kavanagh, Noel'An Economist's Approach to the Measurement of Recreation Demand' in The Demand for Outdoor Recreation in the Countryside (London: Countryside Commission, Jan. 1970) pp. 29. 13 sole owner of the site if he charged one optimum fee' to all users. This value is then said to reflect the annual benefit of the recreational site and it can be compared to similarly calculated benefits arising from other uses or other sites. Alternative methods of measuring benefits have been used, most commonly among these, the total area under the demand curve has been calculated.2 In addition to providing an estimate of recreation benefits which is more directly comparable with measures of other benefits from projects (e.g. the value of water), the method used here has two computational advantages. Firstly it is not necessary to specify the demand curve over its full length (i.e. from axis to axis). Secondly, and more importantly perhaps, the resultant measure of recreational benefit is fairly robust. Because it is a measure of a maximum the figures adjacent to it produce results only slightly lower; also the results from different mathematical functions can be very similar. Both advantages will be particularly well demonstrated in Section III on fishing, Table 3.1. The Clawson method has been applied in a number of cases, with encouraging results.3 Several studies have tried to develop the method to overcome some of the inherent limitations. One such limitation, recognised by Clawson, was that transfer costs do not include time and inconvenience, although such non-monetary costs can be important and are likely to vary among participants. As yet there is no fully accepted way of dealing with this element although other workers4 have incorporated it in their studies. Another limitation is the assumption that all other demand determinants remain constant, and attempts have been made to allow for differences in income and differences in the prices of other commodities. Income variables are incorporated in the analysis of recreation at Derwent Reservoir which follows. Earlier studies have shown that the estimate of annual benefit can vary considerably according to the precise mathematical function fitted to the observed data and also depending on the assumed cost per mile for travel. Thus in later sections of this report alternative assumptions have been used and the results compared.

Another method for measuring the annual benefit would be to estimate the'consumer surplus' accruing to users of the site. The main drawback with this approach is that the consumer surplus value is not comparable with the concept of value determined by accounting techniques which are commonly used in assessing other project benefits. Thus the consumer surplus value might not be comparable to the value ofthe resource in other uses. For a more detailed discussion see: Crutchfield,James A.,'Valuation of a Fishery Resource', Land Economics, Vol. XXXVIII No. 2(May 1962). Brown, W. G., Singh, A. and Castle, E. N., 1964 op. cit. 2 See, for example, Smith, R.J., 'The Evaluation of Recreation Benefits: the Clawson Method in Prac- tice' Urban Studies, Vol. 8, Number 2, June 1971. 3 This section draws information from the following sources: Brown, W.G., Singh, A. and Castle, E. N., 1964 op. cit. Smith, R.J., 1971, op. cit. Wennergren, Boyd 'Demand Estimates and Resource Values for Resident Deer Hunting in Utah,' Bulletin 469 (Logan, Utah:June 1967). 4 In particular Smith, R. J., 1971 op. cit., and Mansfield, N. W., in the 'Estimation of Benefits from Recreation sites and the Provision of a New Facility' Regional Studies, Vol. 5, 1971. 14 Finally it should be noted that, in isolation, estimates of annual benefit offer little guidance regarding the management of the recreational facility. For example no account is taken of the direct capital and operating costs of the facility. For fishing the amount spent on stocking can be substantial and restocking would affect the qualities of fishing; reduction in the price of permits associated with an increase in the number of fishing-days would reduce the likely catch per rod, unless more stock were purchased with implications for the long-term. By the same token annual benefit gives little help in deciding the pricing policy for the recreational facility. What the Clawson method does is offer a means of predicting rates of utilisation of sites, and an estimate of the welfare benefits of a particular site. Both of these types of information are relevant to public investment decisions. However they might be of some limited assistance in deciding pricing policies. For example the price elasticities which can be inferred, would enable estimation of changes in participation to be expected from changes in entry fee.

15 3. THE VALUE OF FISHING AT DERWENT RESERVOIR The Sunderland and South Shields Water Company offers facilities for fly fishing for trout on the reservoir. The season runs from May until September, and a number of rowing boats and powered boats are available for hire in addition to bank fishing. Anglers may purchase a seasonal permit( 20), or a day permit (75p) and in addition need a trout licence from the Northumbrian River Authority. During the first four years of operation the annual revenue of the Company from rod permits and boat hire has varied between 8,000 and 10,000, with the total recorded catch varying between 9,000 and 14,000 fish. Providing the fishing facility involves the company in a number of items of expenditure. The major item is stocking the reservoir, where policy has been to purchase 2 year old brown and rainbow trout, the annual totals varying from 8,000 to 12,000 at a cost of between 3,400 and 4,300 per year. There are also boat maintenance costs and some part of the wages and salaries of employees involved in the fishing side. The benefits arising from angling have been estimated by using an extended version of the Clawson method described in the preceding section, where it was pointed out that travelling and other expenses incurred by anglers—as well as the permit fees, must be taken into account. The modified form not only derives the average prices paid in the various distance zones but also takes account of differences in average household incomes between zones. One practical iisue in applying the Clawson method is deciding the number of different zones to be used. The larger the number of zones the more points are derived for the final curve-fitting, but offsetting this advantage will be the smaller number of observations per zone and hence a greater chance of random variation. For example if some zones contain no participants among the sample this presents difficulties in subsequent analysis. In this analysis local authority areas around the reservoir were used to define the zones. These were the smallest aggregations for which observations were readily available and thus provided the greatest number of points, but at the same time, because of the population densities, their use ensured a reasonable participation rate. Using local authority areas there were four zones with zero participation rates within a 55-mile radius of the reservoir and where these occurred this zone was amalgamated with another zone, preferably adjoining and at about the same distance. A complete listing of the 62 zones is given in Appendix 1.

The Data Data on angling were taken from the records kept by the company for the 1970 season on a random basis. The final sample accounted for 10.03 per cent of the total fishing days. Addresses of anglers were recorded so that, by dividing the number 16 of anglers in each local authority area by the total population, participation rates could be readily derived. The average total price per fishing day paid by participants in each area was calculated by summing the average rod permit fee of 0.6144,1 the average expenditure on hiring boats and an imputed cost of travel. Since less than 10 per cent of anglers hire boats the average cost per fishing day is small. Regarding travel costs the round trip mileage was costed at an imputed rate per mile divided by average number of anglers per car travelling from that zone. Average household income data for anglers and other members of the population in the zones were not known, but an index was derived based on the Registrar General's classification of population into socio-economic groups. This index, developed by Cox,2 is the arithmetic mean of two ratios derived from the population census. The ratios are, first, the percentage of male managerial and professional people (both occupied and retired) in the area, divided by the national percentage and multiplied by 100; the second is obtained by manipulating the average number of persons per household in the same way. This index approximately reflects differences in average incomes between zones.

The Analysis The data provided estimates of the three variables to be related for each zone— the rate of participation, the average total price paid and the average income of households—with the possibility of changing the estimate of total price by changing the imputed cost per mile of transport. Clearly the operating cost of a car per mile depends upon the size, age, average mileage and loading of the car in question. In the absence of estimates of actual transport costs, two different levels of cost per mile have been used, namely 0.04 per mile and 131.0125 per mile. Nationally the higher of these figures represents the full cost of operating an average family car including depreciation, tax and insurance, while the lower figure represents only the direct running costs of petrol, oil, tyres etc. Using imputed mileage charges of such differences gives an indication of the sensitivity of the results to transport cost errors or differences. The general mathematical relationship is R =f(P, Y)

1 This is a weighted average of the daily and seasonal rod permit fee. The cost of the trout licence has been ignored: the amount involved per fishing day would be impossible to estimate because the total number of days each angler fishes for trout is not known. Strictly speaking weighting the components of a two part price structure is inappropriate because for any one trip the marginal cost of a season ticket is zero. It can therefore be argued that season and day-permit visits should be analysed separately. Methods of dealing with this problem are discussed in 'Problems of Measuring Recreation Benefits With Dual Pricing Systems' by Gibson,J. G. 2 COX, W.E., 'The Estimation ofIncomes and Expenditures in British Towns', Applied Statistics, Vol. 17 pp. 252-259, 1968. A fuller discussion of Cox's method will be found in Willis, K. G.,'Modeles of Population and Income' Agricultural Adjustment Unit Research Monograph No. 1, Dec. 1971, p. 26. 17 where R is the rate of participation, P the average total price, Y the average household income, with the subscript i relating to the i-th zone of the sixty-two deline- ated. Visual inspection of scatter diagrams of the observations suggested two alternative mathematical relationships could be appropriate. The first of these is a power function R = 0c.P131. 1432 where a, pl and 132 are the parameters to be estimated statistically. This type of function assumes that the percentage change in Ri is a linear function of the percentage changes in Pi and Yi. The second relationship was exponential, R e a-FP1 P+P2 Y again with a, pi and /32 being the parameters to be estimated. This type of function assumes that the percentage change in R is a linear function of the absolute changes in P and Y. Both of these forms are theoretically plausible. The statistical results, evaluating the three parameters, using the two functions and the two mileage charges, are shown below using logarithmic form for presentational convenience.

Power function (mileage charge (:1.04) A. log R = —0.260 —2.215 log P+0.751 log Y R2 = 0.31) (0.433) (0.666) (mileage charge k0.0125) B. log R = —2142 —2-218 log P+0.907 log Y (R2 = 018) (0.614) (0-740)

Exponential function (mileage charge k0.04) C. log R = 2.801 —0.922P +0.008 Y (R2 = 0-31) (0.178) (0.007) (mileage charge £00125) D. log R = 2.369 —1.327 P +0.008 Y (R2 = 0-15) (0.413) (0.008)

The figures in parenthesis under the coefficients are the standard errors. The t-values for the power functions were —5.114, 1127; —3.614 and 1.226; while those for the exponential functions were —5183, 1402; —3.214 and 1.049 18 respectively. In all cases the first parameter was adjusted so that the function passed through the one known set of demand co-ordinates.' In all four cases the signs of the relationships are as expected, that is to say an increase in participation rate would result from either a reduction in price or an increase in income. However the link between participation and price is statistically much stronger than that between participation and the income index. The simple correlation coefficients between Rand Pare —0.55, —0.44, —0.54 and 0.37 respectively, whereas the coefficient between Rand Y is +0.04,0.04, 0.03 and 0.03 respectively. Considering the three variables together, the R2 statistics, ranging from 0.31 to

1 An alternative to this would have been to 'force' the regression line through the one known pair of co-ordinates in estimating parameters. This would have produced biased estimates of the price and income coefficients but an unbiased estimate of the intercept. On balance it seemed preferable to obtain the best possible estimates of the coefficients at the expense ofsome possible error in the intercept value which has little economic meaning when the monopoly return concept of value is used. TABLE 3.1 THE ANNUAL BENEFIT FROM ANGLING IN DERWENT RESERVOIR

Change in rod No. of permitfee (k) fishing-days Revenue(k) 1

Function A. (Power Function: 0.55 6,077 7,375 mileage cost 4p) MO 6,343 7,381 0.45 6,626 7,379 0 10,3792 6,8872

Function B. (Power Function: —010 12,521 7,057 mileage cost 1.250 —015 13,848 7,112 —0.20 15,400 7,139 —0.25 17,234 7,128

Function C. (Exponential Function: 0.50 6,552 7,624 mileage cost 4p) 0.45 6,861 7,640 0.40 7,184 7,641 0.35 7,523 7,625

Function D. (Exponential Function: 015 8,505 6,920 mileage cost 1-25p) 010 9,089 6,940 0.05 9,712 6,930 0 10,3792 6,8872

1 Revenue = number of fishing-days demanded X average angling fee for day. 2 The 10,379 fishing-days and J6,887 revenue were the actual figures for 1970. 19 045 indicate the percentage of variation in participation rate explained by price and income. In fact nearly all of the explanatory power is due to price and the average income variable adds little to the relationship established. The likely reason for this relative failure is that the income index is too crude a measure ofinter -zonal income variation. Despite any reservations regarding the income variable, the relationship between participation and price is statistically significant so that the final stage of measuring benefits can be undertaken with some confidence. The key results are presented in Table 3.1 above. As can be seen from Table 3.1 the four maxima occur at different points on the price scale, but the absolute magnitudes of J7,381, £7,139, £7,641 and £6,940 are remarkably close together, so that although the four functions had considerable variation in the coefficients and their statistical significance the final estimate of angling benefit is similar, averaging £7,275. Conclusions The main methodological conclusions of this analysis are that applying the Clawson method to angling benefits on Derwent Reservoir produces statistically significant results and that differences in mathematical function and mileage charges effect the size of the estimated parameters. Admittedly the relationship between participation rates and household income was rather weak, but that between participation rates and price was significant and confirmed that a recreational commodity like fishing has similar demand characteristics to those of other goods. In this particular case the higher mileage charge gives a better fit than the lower and the exponential function a slightly better fit than the power function. As far as the final results are concerned the four different equations provided very similar estimates of the annual benefit from angling. If the mean of the four figures is used as an indicator of annual benefit, namely £7,275 this can be converted to a capital sum, using normal discounting techniques. These are shown in Table 3.2 below, using three different discount rates.

TABLE 3.2 THE PRESENT DISCOUNTED VALUE OF 40 YEARS' OF BENEFITS FROM ANGLING AT DERWENT RESERVOIR2

Discount rate Present value() 5 per cent 124,800 8 per cent 86,700 12 per cent 59,900

1 The period of 40 years has been arbitrarily chosen as a possible planning horizon for recreational facilities. In particular cases the time period might be more precisely indicated by the project. 2 Based on an annual estimate of 7,275.

20 4. DAY-VISITING BENEFITS AT DERWENT RESERVOIR

The Durham and Northumberland County Councils realised at the planning stage of the reservoir that it would attract a number of day-visitors, particularly during summer week-ends. Lay-bys, picnic areas and country parks were provided and these facilities have been improved and expanded during the first four years of the reservoir.1 Construction of new recreation facilities influences the pattern of consumption in two ways: it offers new opportunities to people for the first time but it also attracts consumers away from existing facilities. These two attributes, labelled trip generation and trip diversion effects, both contribute to the response to a new facility. They are of slight importance to the Derwent Reservoir where new facilities are now being created comparatively slowly, but they become more important in considering the addition of a major new recreational site to the regional supply. For the present chapter it should be noted that some new facilities have been added since the data was collected, in 1970.

The Data The information used here to estimate the benefits of day-visiting was collected through personal interviews at the reservoir.2 On two consecutive Sundays, 21 and 28 June 1970, interviews were conducted by students of the Department of Geography, Bede College, the University of Durham, working in conjunction with the Planning Departments of the Northumberland and Durham County Councils. On the first Sunday 335 family interviews were completed and on the second 201 (representing a total of 1,843 people) the difference being at least partly due to the different weather on the two days. Based on a count of vehicles parked at the ten interview points around the reservoir, it was estimated that the number interviewed represented 52.5 per cent of the number of day-visitors on the two days. No data were available about total day-visiting over the whole year, so it was not possible to raise the sample data accurately to represent the total. In consequence the best that could be attempted was a judgement as to the appropriate factor. Bearing in mind that Sunday is the most popular day of the week and late June one of the most popular times of the year, it was considered that the total number of visitor-days was likely to be about ten times the total number on the two Sundays, or around 35,000. To give a measure of the range of possibilities, however raising factors of twenty and of five were also used in the calculations.

For a detailed account of the planning for day-visitors see: Derwent Reservoir. Provision for Recrea- tional Facilities,(Durham County Planning Department, Dec. 1966). 2 For a more complete explanation of the conditions under which the interview survey was conducted see: Derwent Reservoir Visitor Survey, 1970 (Derwent Valley Advisory Committee, March 1971). 21 The Estimation of Benefits Benefits from day-visiting were calculated using the Clawson method as with fishing, deriving rates of participation from the different local authority areas, the average total price and the household income index as described in the preceding section. Only one imputed mileage charge was used, namely 131.04 per mile, since this is regarded as a more realistic rate. However both the power function and the exponential functions were estimated. One point of difference between day-visiting and fishing can be noted, namely that day-visitors do not pay an entry fee, analagous to the rod permit fee. Since it is explicitly assumed that 1 spent on travel is the same in the consumers' eyes as 1 spent on admission charges, this does not change the methodology. However it is apparent that the results may not be interpreted as a guide to pricing policy—a point which has already been made—without further evidence. The application of least squares regression analysis to the data provided by interview gave the following results. Power Function log R = —3.956 —2.267 log P+0.613 log Y (R2 = 0.70) (0.217) (0.481) Exponential Function log R = 2.055 —4454 P +0.006 Y (R2 = 0.70) (0.391) (0.005) (the t-values for the power and exponential functions were respectively: 10.428, F273; —10.632, 1.319) Both functions are equally successful (R2 = 0.70) in explaining variations in. R due to P and Y. However, as with fishing, it is the relationship between participation rates and average price per zone which is most significant statistically (being different from zero at the 1 per cent level), whereas the relationship with the household income index is very weak and adds little explanatory power (the correlation coefficient between R and P also being 0.68 and 0.69). Applying the procedure to the functions to derive a range of points on the two demand functions at this site yielded the results in Table 4.1. It can be noted once again that the maximum of each function is not strikingly higher than the revenue at nearby points and further that, although the two functions provide maxima at different prices, the final results are less than 3 per cent apart, so that an intermediate figure of 320 can safely be used in subsequent calculations. Two simple mathematical operations are necessary to convert the 320 into a present value of day-visiting benefits. Firstly it is necessary to scale up the figure to give an annual value of benefit. As indicated early three raising factors will 22 TABLE 4.1 THE MAXIMUM REVENUE OBTAINABLE FROM DAY-VISITING

Powerfunction Exponentialfunction Admissionfee (D Visitor-days Revenue() Visitor-days Revenue(k)

0.20 1,497 299.40 1,561 312.20 0.25 1,259 314.75 1,268 317.00 0.30 1,076 322.80 1,030 309.00 0.35 931 325.85 837 292.95 0.40 814 325.60 680 272.00 used: x 5, x 10 and x 20 corresponding with a range ofsampling fractions. Secondly the annual benefits are discounted at an appropriate discount rate in summing over the planning period which has been set at forty years as an example of a possible time horizon. Here three discount rates are given 5 per cent, 8 per cent and 12 per cent. The final results are presented in Table 4.2, from which it can be seen that the central estimate of day-visiting benefits, corresponding with the 8 per cent discount rate, is 38,200, but with a wide range possible because of the raising factor.

TABLE 4.2 THE PRESENT DISCOUNTED VALUE OF 40 YEARS OF BENEFITS FROM DAY-VISITING AT DERWENT RESERVOIR*

Present value at each sampling percentage() Discount rate 20% 10% 5%

5% 27,500 54,900 109,800 8% 19,100 38,200 76,300 12% 13,200 26,400 52,800

* Based on a 2-Sunday figure of £320. See footnote to Table 3.2.

23 5. SAILING AT DERWENT RESERVOIR

The Sailing Club was started in 1967, the clubhouse was completed in 1969, and is now approaching the target membership of 1,000. The season is from April to December and seven classes of racing dinghy are approved for sailing. In terms of consumer behaviour sailing is different from fishing and day-visiting in two important respects. Firstly the sailing boat is larger and less easily transportable than the normal complement of fishing tackle and, no doubt partly as a result of this, members of the sailing club tend to be found nearer to the reservoir. Secondly the sailing consumer has two sequential choices, firstly the choice to apply for membership, secondly within the membership there is the choice of how much he will use the facilities. This point is picked up later in the analysis. The objectives of the enquiry into sailing were twofold. Firstly there was the need to measure benefits from sailing by the Clawson method, so that the results could be compared with, and added to, those from fishing and day-visiting. Secondly an attempt could be made to measure the economic impact of the sailing club on the local rural economy. There is much talk about the potential of tourism and recreation for generating income in rural areas, but in many cases it is apparent, that, although consumers appreciate the facilities and derive measurable benefits from them, those facilities generate little additional employment nor do they lead to much additional spending in the rural areas. A better understanding of the relationship between recreation and local income generation should lead to better policies in this area, with the implications this contains for local and national government.

The Data The method of enquiry employed was to use postal questionnaires. A questionnaire (a copy of which is in Appendix 4) was sent to each of the 594 addresses of members and one reminder was sent to each non-respondent. Eventually 419 completed forms were received. This response rate of 68 per cent is high for postal surveys and the results are correspondingly significant. Some 45 of the returned forms were not included in the analysis, for reasons which included lapsed membership, change of address and death. The final sample of 374 has been used in subsequent analysis, raised where appropriate by 100/68 to represent the total membership including non-respondents.

The Sailing Benefits The method adopted to measure sailing benefits was the same as that described earlier, using the same three variables. Participation rate and average total price were determined in the same way, in the latter case using a mileage charge of 24 0.04 per mile.' However with household income there is a major difference. In the earlier analysis a weak statistical relationship between the household income index and participation rates was found. Since direct measures of household income had been obtained through the sailing club survey it was decided to use these to generate estimates ofaverage household income per zone.In consequence the income data from the questionnaires was averaged by local authority areas, as the measure of household income per zone. The results of fitting the data were as follows: Power Function log R = 5.6020 —1.6498 log P —0.7857 log Y(R 2 = 0.55) (0.3042) (0.4497) Exponential Function log R = 3.6594 —3.9165 P —0.0003 Y (R2 = 0.55) (0.7442) (0.0001) The t-values were —5.424, —1.747; —5.262, —2.189 respectively. Once again there is a strong negative correlation between participation rates and average total prices, significant at the 1 per cent level. The income coefficients are perverse in both functions, a point which is examined later in this section but, even with the more direct income data, were significant only at the 5 per cent level. TABLE 5.1 ESTIMATES OF TOTAL REVENUE ACCRUING UNDER VARIOUS ASSUMED DAILY SAILING FEES, FOR THE PERIOD APRIL-JULY, 1970

Powerfunction Exponentialfunction Daily sailing Sailing-days Total Sailing-days Total fee() demanded revenue demanded revenue() 0.20 2,529 506 2,886 577 0.25 2,173 - 543 2,376 594 0.30 1,893 568 1,951 585 0.35 1,669 584 1,604 561 0.40 1,486 594 1,319 528 0.45 1,335 601 1,085 488 0.50 1,206 603 891 446 0.55 1,098 604 733 403 0.60 1,005 603 602 361

1 Data on costs of membership of the club were not collected nor were details of costs of boat owning. It was felt that the complexity introduced into the sample survey by incorporating these matters was unlikely to be justified in terms of the results. 25 Following the procedure previously described, the two functions were ma- nipulated to derive a series of points on the two demand curves, postulating a series of hypothetical daily sailing fees. The results are shown in Table 5.1. From the Table it can be seen that the two estimates of maximum revenue are within 2 per cent of each other and that a figure of 600 is a convenient intermediate estimate of benefits for the four-months April—July 1970. This figure can be converted to an estimate of annual benefits by applying a factor of 2.7, which is based on the ratio of entries for sailing races in the April—July period to entrants during November—October. This gives an annual benefit of 1,620. The present discounted value of sailing benefits over a forty-year period, with various discount rates, are given in Table 5.2.

TABLE 5.2

PRESENT DISCOUNTED VALUE OF 40 YEARS' SAILING BENEFITS AT DERWENT RESERVOIR*

Discount rate Present value()

5% 27,800 8% 19,300 12% 13,300

* See footnote 1 to Table 3.2.

The middle figure of 19,300 represents the 'best' estimate, corresponding with the 8 per cent discount rate, of the present value of sailing benefits.

Other Results of the Survey For convenience sailing club members were grouped in the analysis according to the local authority area of domicile.(Appendix 5 gives details of the survey). The overall average distance from home to the sailing club was 20.8 miles, ranging from under 10 to over 70 miles in different local authorities. On average members had visited the club 10.6 times each during the April—July period. Four-fifths of those sampled had made at least one visit in the July. The average number of people per car was two and a half, ranging from one to seven. More than three- quarters of the members are between 20 and 50 years old and have an average 2.18 children. Excluding those who have retired and students, the members recorded an average working week of 42.4 hours. 26 Information on incomes of sailing club members is compared with the national distribution in Table 5.3. TABLE 5.3 DISTRIBUTION OF INCOME OF SAILING CLUB MEMBERS COMPARED WITH ALL U.K. HOUSEHOLDS

Range of household income, Sailing clubl U.K. households,2 before tax members 1967-68 1,000 or under 2.3 594 k1,001—k2,000 18.0 34.2 k2,001—k3,000 274 4.7 k3,001-k4,000 20.9 1.3 4,001—k5,000 9.5 1.3 over k5,000 21-9 0.7

100% 100%

1 Based on 306 replies relating to 1971. 2 National Income and Expenditure, H.M.S.O. 1969. Even allowing for some inflation since 1967-8 it is clear that sailing club members have a much higher income than for the U.K. as a whole, with more than half the members' households basic income over 3,000.

Participation Rates and Incomes The availability of individual data on incomes allows additional analysis to be undertaken about participation rates and incomes. Earlier in this section both functions generated a negative coefficient for income, indicating that the higher the income the lower the likely participation rate—which superficially seem g an unlikely result. Apparently perverse results have been met by other research workers, who have offered explanations such as: 1 'For example, in the case ofsailing, a person with a low income may be much less likely to be willing to pay the membership fee than a person with a high income. However, the low income person who does join will probably do so because he is sure that he will be able to use the club facilities frequently, whereas the person with a higher income may be willing to pay the membership fee for just a few visits. In such a case it would appear that the income elasticity of demand for visits, once one is a club member, is negative, whereas the income elasticity of demand for membership is positive; the income elasticity ofdemand for visits in total may then be either positive or negative.' It is possible to test whether such an explanation is applicable to the Derwent Reservoir Sailing Club in two stages. Firstly a separate examination of the lower

1 Smith, R.J., 'Recreational Surveys: Some Comments and Results', Studies of Recreational Demand No. 7, University of Birmingham, Faculty of Commerce and Social Science, Discussion Paper, Series B, No. 22, September, 1970, pp. 7-8. 27 income categories, e.g. those with incomes of 4,000 or less, might show a positive income elasticity. Secondly it may be possible to measure the income elasticity of membership, as opposed to the elasticity of participation rates. Using only the power function two equations were derived, one for the whole sample, the other for incomes 4,000 p.a. or less. Participation rates and travel costs were derived as before but applied to individuals, not to local authority areas, since individual incomes were employed. The results were as follows: Whole sample: log R = 2.9711 —0.1957 log P —0.08823 Y R2 = 0.14) (0.0936) (0.1439) Incomes of 4,000 or less: log R = 2.971 —0.2549 log P +0.0593 log Y (R2 = 0.17) (0412) (0.2327)

The whole sample of 263 observations had t-values of —2.0899, —0.6131; the sub-sample of 183 observations had t-values of —2.2918, +0.4123. Thus the separation of lower incomes has led to a change in the sign of the income elasticity, but in view of the low level of statistical significance of income in the regression, this is only qualified support for the original hypothesis. The second analysis required a measure of the demand for membership as opposed to participation. This was derived by calculating the proportion of the population of each of the local authority areas who were registered members of the Sailing Club in July. For numerical convenience the index used was the number of members of the Sailing Club per 10,000 of population—symbolised as M for total membership and M' for members responding to the questionnaire. Two possible measures of travel cost were used, the actual mileage travelled (T) and the notional transfer cost used previously; two measures of income were used, namely the average income recorded by members of the Sailing Club in each local authority area and the household income index used earlier. The power function was fitted to all combinations of the variables and the main results obtained are shown in Table 5.4. As can be seen, all of the coefficients of average income (which are the income elasticities) are positive whereas three of the coefficients of the income index are negative. The statistical significance in some coefficients is weak, it is satisfactory for most of the coefficients of average income. It appears from these equations that tile direct measure of income is a considerable improvement over the indirect index. On balance it appears that the negative income elasticities derived from the general model concealed two separate elements, namely a positive income elasticity for membership, but a negative income elasticity for participation within the membership. 28 TABLE 5.4 DEMAND FOR MEMBERSHIP OF THE SAILING CLUB

Membership-rate Constant Travel mileage Average price Income index Average income Function All members Respondents only R2 nutnber log M log M' log T log P log Y log Y 0.7419 1 1 == 6.7184 -1•6255 -01198 (0.3101) (0.4358) 0.6386 2 1 = 6.6695 -13075 -0.9039 (0.3404) (0.4821) 0.5912 3 1 = -4.0610 -12828 0.7751 (0.3566) (0.7920) 0•7744 4 1 = 1•0264 -1•7242 1.1147 (0.2848) (06262) 0•7385 5 1 = 4.0738 -1.4887 0.2253 (0.2761) (0.3872) 0.6813 6 1 = 4.0100 -13072 -0•5054 (0.2860) (0.4052) 0.7301 7 1 = -6•3290 -1.3267 1•3872 (0.2670) (0.5928) 0.8271 8 1 = -1•4207 -1•5560 1•6645 (0.2235) (0.4915)

NOTES: 1. Standard errors of coefficients are in brackets. 2. A coefficient of1 indicates the dependent variable in a particular equation. Expenditure The completed questionnaires contained information on expenditure by members in the course of travelling to and from the club and while they were there. The average results are shown in Table 5.5. Applying a raising factor to this information provides an estimate of total annual expenditure of about 16,500, of which 6,000 was spent more than 5 miles from the clubhouse, 10,500 within 5 miles, over J6,000 of which was spent in the clubhouse itself. This compares closely with the actual turnover of the sailing club for the same period. The figures for petrol and oil expenditure came to 2.8p per mile travelled, which is rather high suggesting that the visit to the sailing club is used as an opportunity to fill the petrol tank—covering non-sailing uses of the car. Even if these expenditure figures are subject to error it can be seen that the impact of the sailing club on the nearby rural economy is very small, since most of the items purchased contribute only a retail margin to incomes in the area. Admittedly there are other expenditures not accounted for here. Boat repair and maintenance is one obvious item; another is the possible provision of bed and breakfast at some times of the year. However even on best assumptions, the resultant impact on local economy is likely to be small. As is so often the case with rural recreational facilities, although benefits to recreationalists can be high, their expenditure within the area may be small and as a result this type of development may not be attractive to private enterprise.

TABLE 5.5 AVERAGE EXPENDITURE PER PERSON ON MOST RECENT VISIT TO THE SAILING CLUB (PENCE/HEAD)

Where spent

Within 5 miles More than Item of the 5 miles Total clubhouse from the clubhouse

Food and drink en route 1..64 5.68 7.50 Food and drink in the clubhouse 23.54 23.54 Petrol and Oil 6.30 16.99 23-29 Other items 7.26 0.30 7.56

38.74 23.15 61.89

30 6. RECREATIONAL BENEFITS AT THE PROPOSED NORTH TYNE RESERVOIR

The preceding three sections of this report have discussed recreational benefits of a facility created in 1967 and since developed. The type of analysis undertaken offers a means of predicting the value of benefits at alternative sites which are under consideration. Thus it is relevant to the original decision to construct a reservoir and allocate some resources to recreational facilities. In consequence, although the earlier results may be of historic interest, the basic aim is to develop methods of analysis and estimates of parameters which can be applied to new or proposed projects. Although proposed public investments in water resources are evaluated in the U.K., they are not normally subjected to formal benefit—cost analysis, part of which would be an assessment of recreational benefits. One project which has been proposed is the construction of a reservoir on the North Tyne at Otterstone, about 45 miles N.W. of Newcastle upon Tyne. The reservoir would cover some 3,000 acres and would involve a total capital outlay of some k27rn of which 9n-i would be reservoir costs and 18m with associated water extraction and distribution facilities downstream.1 There has been considerable public debate about this proposed reservoir during 1970 and 1971 and a public enquiry is to take place in 1972, after which a decision is expected on whether or not to proceed with the project. With the increased volume of public investment expected in the water resources field, it seems likely that evaluation techniques will become more important and, hopefully, more accurate. Recreational benefits are almost certain to be only a small fraction oftotal benefits, but nevertheless should be included in any evaluation. Methods of analysing such recreational benefits have been discussed earlier in this report. What follows is an attempt to apply these methods to the proposed North Tyne Reservoir. It has been assumed that the consumer will react to this new reservoir to the same extent that they have to the Derwent Reservoir.2 That is to say that the power functions for day-visiting, fishing and sailing can be applied to the North Tyne.3

1 Northumbrian River Authority,'On Tap, No. 2', April 1971. same way 2 This includes an important assumption that facilities on the North Tyne will be priced, in the as they are at Derwent. Different sailing club membership or rod permit charges or different fish stocking policies or forms of sailing organisations. A similar study, with a more detailed treatment of methodological problems arising from the competition of new sites with existing ones has recently been published by Mansfield, N. W., op. cit. The Mansfield study differs from this one in that he treats Morecambe Bay as an extension of the Lake Dis- trict and bases his demand estimates on the behaviour of three different classes of visitor—full-day, half-day and holiday trip visitors, whereas the present study uses the demand functions estimated earlier for three specific activities, all of which involve day visits to the Derwent Reservoir. The Mansfield study also projects benefits forward to 1981. 31 Each reservoir is unique of course, but it is hoped that there are sufficient similarities between the North Tyne and the Derwent so that meaningful com- parisons can be drawn. There are two other serious causes for qualification. The first is that analysis on the Derwent Reservoir has shown that some of the data are in need of improvement and that some of the statistical relationships are less significant than desirable. As an example of this aspect, the difference between mileage charges of 13$.04 and 13.0125 may not be important for the Derwent Reservoir, which is within 20-30 miles of major urban centres, but may become so for the North Tyne Reservoir, which is much more isolated. If the lower mileage charge were appropriate, instead of the higher charge used in subsequent analysis, the benefits would be greater. Secondly the point was made earlier that a facility creates its own demand. Again, to the extent that this proved to be the case for the North Tyne Reservoir, benefits shown here would be an under- statement. On the other hand benefits may be overstated to the extent that the North Tyne has to compete with other sites for recreationists. The problem of competition between sites has been ignored in this study, assuming that the proposed reservoir would only make a small net addition to the region's recreational opportunities.' Finally the benefits are calculated with reference to 1970-71 conditions which are likely to change before any new reservoir has been completed. As an example, it is possible that some of the dormitory towns North East of Newcastle upon Tyne may experience rapid population growth, which would consequently affect the use of recreational resources only 35 miles away. On balance these qualifications indicate that the estimates prepared in this way will probably understate the full value of recreational benefits at the North Tyne. For these reasons, then, it is necessary to interpret the numerical results with some caution. Generally this section should be seen as a demonstration of a technique rather than an attempt to measure once-and-for-all the recreational benefits.

Predicted Benefits The function used for day benefits, from Section 4, was

log R = 3.956 —2.267 log P +0.613 log Y. Applying this function to the North Tyne gave revenues shown in Table 6.1, which relate to two Sundays in June 1970. 1 Mansfield, N. W.,(1971), op. cit., relaxes this assumption in his study of Morecambe Bay. 32 TABLE 6.1

PREDICTED DAY-VISITOR BENEFITS AT NORTH TYNE RESERVOIR

Admission Visitor-days Revenue Fee demanded

0.75 1,340 100.5 0-80 1,260 100.8 0.85 1,190 101.2 0.90 1,120 100.8 0.95 1,060 100.7

Similarly with fishing benefits, the equation: log R = —0.260 —2.215 log P +0.751 log Y gave rise to Table 6.2.

TABLE 6.2

PREDICTED ANNUAL FISHING BENEFITS AT NORTH TYNE RESERVOIR

Permit Fishing-days Revenue Fee demanded 0.80 9,773 7,818 0.85 9,226 7,842 0.90 8,723 7,851 0.95 8,259 7,846 1.0 7,831 7,831

With regard to sailing benefits, the situation is rather different since no information is available about the incomes of potential sailing club members, although this variable is clearly important. To overcome this, the equation in Section 5, log R = 5.6020 —F6498 log P —0.7857 Y was reduced by assuming all incomes to be 3,310 (the average of the Derwent Reservoir Sailing Club members) to give: log R —0.7707 —F6498 log P The resultant revenues generated during April-July 1971, are shown in Table 6.3. 33 . TABLE 6.3 PREDICTED SAILING BENEFITS AT THE NORTH TYNE RESERVOIR

Admission Sailing-days Revenue Fee demanded 1.65 235 388 1.70 229 389 1.75 222 389 1.80 216 389 1.85 210 389 1.90 204 388

The results summed over a period of40 years, at various discount rates are drawn together in Table 6.4, to enable a comparison to be made between the Derwent and the North Tyne.

TABLE 6.4 COMPARING 40 YEARS OF RECREATIONAL BENEFITS ON DERWENT RESERVOIR AND THE PROPOSED NORTH TYNE RESERVOIR AT DIFFERENT DISCOUNT RATES

Proposed North Tyne Dement Reservoir Reservoir @8% @8% @5% @12%

Fishing 86,700 93,600 134,700 64,700 Day-Visitingl 38,100 23,000 33,100 15,900 Sailing 19,300 12,700 18,200 8,800

Total 144,100 £129,300 £186,000 £89,400

1 The day-visiting benefits here all correspond with a 10% sampling fraction. (See page 23).

The rather low value of day-visiting arises because consumers of day-visiting facilities are particularly sensitive to mileage and the North Tyne is considerably more remote from urban centres than Derwent Reservoir. If the lower mileage charge were used in the formulation; or if the North Tyne had appeal to a national rather than regional public, the figures would be substantially higher. The problem of'intervening experiences' may also be important in this context in that the drive to the North Tyne Valley may be a more attractive drive than that to the Derwent Reservoir. Since such considerations may be particularly important in explaining 34 day-visitor behaviour the degree of underestimation for this category of recreationists is likely to be greater than for the others. Fishermen are apparently less sensitive to distance in pursuit of their quarry so that demand at the North Tyne is relatively more buoyant. Since it has been assumed that the consumer has the same attitude to the North Tyne as to the Derwent, no account has been taken of possible differences in the quality of fishing, nor of the possible competition between the two reservoirs for the consumer. Sailing benefits for the North Tyne are estimated lower than on Derwent Reservoir. Again this is a reflection of the distance factor and takes no account of the larger size of the North Tyne Reservoir, which may provide better quality sailing. The major difference between the two centres is explainable in terms of distance from centres of population. A number of qualifications have been made already and should be borne in mind. Perhaps the major difference which has been ignored is that of the quality and diversity of the recreational facilities which may be located in the North Tyne. Even within the limitations of the analysis it is clear that the total amount of recreational benefits generated by facilities similar to that at Der-, went Reservoir, but located at the North Tyne Reservoir, will be small by comparison with the 9m total construction costs of the reservoir.

35 7. SUMMARY AND CONCLUSIONS

With a likely increase of public investment in rural areas for such items as roads, airports and reservoirs, there has been a growing interest in the U.K. in methods of evaluating the total costs of such projects and predicting the stream of benefits. Although discussions and publications on this subject have already contributed to the solution ofthese problems, there are still challenging difficulties, both in method-. ology and with regard to data requirements. These can best be overcome by narrow- ing the field of enquiry, for it is fairly clear that different aspects of benefit-cost analysis warrant different approaches. This report has been concerned with one aspect of public investment only, namely the evaluation of benefits arising from recreation. A particular case study of a reservoir has been used to test both methodology and data requirements. Results have been derived from this analysis, but because of different sources of information, these results should be regarded as indicative only and attention should be focussed more on the methodological aspects. This qualification is particularly important when the proposed North Tyne Reservoir recreational benefits are discussed. Here any weakness in the analysis of the Derwent Reservoir is com- pounded by applying the results, to another possible recreational site with obvious qualitative differences. While it must be recognised that any new project will be unique, it should be possible, with experience, to make some allowances for the individuality of the site in the projections of future benefits. In short it can be readily conceded that the evaluations made here of the proposed North Tyne Reservoir are preliminary and could be improved by a deeper and longer study. However the main argument of this monograph is that a study is intellectually possible, based on the methods discussed above, and that it is in the public interest for such studies to be undertaken. One important aspect of this study of Derwent Reservoir has been the examination of different sources of data for analysis. Information on fishing was obtained from records kept by the water company. Information on day-visiting was obtained from interviewing a sample of visitors at the recreational sites. Information on sailing was obtained by postal questionnaire sent to club members' home addresses. These methods of obtaining data vary in terms of the cost of collection and also the quality of the information received, both of which are important to the research worker. Consulting existing records is fairly economical, but is inevitably limited regarding the scope of information available; there are also likely to be some omissions through lack of conformity by those filling in the original records, in this case the anglers themselves. Field interviewing is expensive if a reasonable sample is to be covered and is not always practicable—for example if there is no convenient series of car assembly points. Postal questionnaires are fairly 36 inexpensive to conduct, but require an initial address list, and then may produce biased results because of non-response rates. In the cases here three variables have been observed, participation rates, the transfer(mainly travel) costs and household incomes. All three systems of collecting data, namely consulting records, interviewing and using postal questionnaires provide reasonable data on participation rates. For transfer costs the use of records is weakest in that it only allows the use of distances travelled, whereas the other two methods permit a deeper probing of methods of travel, number of passengers, attitudes to car running costs. Similarly regarding household incomes it is the latter two methods of collecting information which can give accurate information on the income of participants, although in the end these give no indication ofincome levels of the catchment population, in the case of which more detailed published statistics are required. One final point should be made concerning the data. The functions derived in sections III, IV and V and later used in section VI, were each based on a different source of data. Combining benefits estimated from different types of data may have introduced errors into the results. It would have been preferable to compare sources of data within one recreational activity, but this was not possible within the time and resources available for this research. As far as the results themselves are concerned, the salient feature is that for all three recreational activities there was a statistically strong relationship between participation rate and the total cost (including the transfer cost). Thus the basic price-quantity relationship of conventional demand theory is established. From this relationship demand elasticities can be calculated which correspond with the price and income elasticities in commodity demand studies. The elasticities sum- marise the responsiveness of consumption of the service to a change in its price or the consumer's income.' The estimated price elasticities were —2-2 for fishing, —2-3 for day-visiting and —1-6 for sailing. All three of these coefficients can be described as relatively elastic and they confirm the commonsense view that tile volume of this type of recreation is very much determined by the relative costs of running a motor car. Differences in data source indicate caution in drawing detailed inferences from differences between these price elasticities. The relationship between participation rates and incomes was much less significant statistically. This is suspected to be largely due to the poorer data on the income side. Where better income data were available, on sailing, the results were more

1 The price elasticity in this context is defined as: % change in participation rate per zone % change in price per zone and the income elasticity as: % change in participation per zone % change in average income per zone 37 significant. The income elasticities of demand were +0.8 for fishing, +0.6 for day-visiting and —0.8 for sailing. The negative elasticity for sailing may be explained by reference to the high incomes of sailing club members and to the fact that it is an elasticity of participation within the defined membership. A priori one would expect somewhat higher income elasticities, but it should be remembered that these figures do not cover 'all fishing' of participants, but only that at one site. The income elasticities, if accurate, would be of use in regional planning of recreational facilities, since they can be related to forecasts of income increases. A summary of the estimated future benefits of recreation at both reservoirs was given in Table 6.4. The smaller contribution is from sailing, a reflection of the smaller numbers of participants. The decline in the relative importance of day- visiting at the North Tyne Reservoir is a reflection of the greater distance from it to the main urban centres. Perhaps the most pertinent feature is the smallness of total recreational benefits by comparison with the capital costs of the projects. While this suggests that recreational benefits by themselves could seldom be used to justify an investment of this type, it does not rule out the possibility of recreation being a useful, if subsidiary, contributor to an ongoing scheme. There are several aspects of methodological interest. Most other work in this field by British researchers has measured benefits by using the concept of consumer surplus, whereas here it is the maximum revenue concept which is employed. While the former may have a slight edge by economic welfare criteria it has practical disadvantages, in that the measure of benefits may not be directly comparable with other benefits and depends to a large extent on the nature of demand function which is assumed, not only near the existing price level but also along its length back to the high price at which consumption would be zero. The latter arbitrary assumption may be the most important single determinent of recreational benefits. By contrast, the maximum revenue concept is robust as a measure, as has been demonstrated in sections III, IV and V, and is much less affected by the functional forms of demand assumed here. In view of these advantages it is suggested that the maximum revenue concept of economic value may well be more useful for this particular type of analysis. One point which has not been mentioned, but which is of obvious relevance to public decisions is the way in which the costs and benefits of a project are distributed between citizens. Within a given overall measure of costs and benefits, decision makers might weigh differently costs which impinge heavily on a few and those which are spread thinly over many and benefits which accrue to the privileged few compared with those available to the populace at large. Comparing projects where distribution patterns are widely different is a difficult exercise, but some additional indicators can be calculated, such as the absolute number and the average income of participants. 38 A detailed assessment of the distribution of benefits between the three groups of recreationists at the Derwent Reservoir has not been attempted. It is, nevertheless, quite evident that fishing accounts for most visitor days with day-visiting next and sailing last. A comparison of the estimated annual benefit per visitor day gives a rough indication of the way in which the benefits are distributed amongst the three groups: Gross Number Benefit Annual of per Benefit(D visitor-days visitor-day()

Fishing 7,875 6,077 1.30 Day-Visits 326 931 0.35 Sailing 1,631 2,965 0.55 (These results are obtained from the power functions in the text; they relate to the maximum revenue situation.)

However a problem of comparability arises here in that there will evidently be a large number of repeat visits for sailors relative to day-visitors and anglers. Hence these data will understate the benefit per person to sailors in comparison with other recreationists. This discussion perhaps serves to illustrate the difficulty of taking adequate account of the distribution of benefits amongst individuals despite the fact that this may be at least as important to decision-makers as the aggregate benefits produced. The opening argument of this monograph was that, because of the likely increase in public investments in items like reservoirs, there was a growing need for work- able methods of evaluating costs and benefits. To ensure that inter-project com- parisons can be meaningful, it is essential that these methods of evaluation are theoretically appropriate, but in addition it is essential to standardise procedures, using common definitions of terms, standardised conventions for cost and benefit measurement, uniform sources of data if consistent decisions are to be made. In short there is a need for a code of practice for benefit—cost procedures. This monograph has examined briefly one aspect of this, namely the measurement of recreational benefits. However this is an exploratory approach and has been written to provoke discussion and exchange of ideas.

39 APPENDIX 1 Observed Fishing Data

Observed Average Average number price price of at at Index of 1966 fishing- k0.0125 &04 Household Local Authority Area Population' days2 per mile per mile Income3

Ashington U.D. 26,199 4 1-50 345 69.6 Bedlingtonshire U.D. 30,689 23 F39 2.34 71.6 Newbiggin-by-the-Sea U.D. 9,928 2 1.11 1-89 70.9 Newcastle upon Tyne C.B. 251,131 68 1.25 2.01 90.6 Gosforth U.D. 27,546 9 1.18 F84 1431 Longbenton U.D. 47,595 4 1.09 1.83 92.9 Newburn U.D. 31,518 4 F28 1.84 84.8 Seaton Valley U.D. 27,169 8 1.32 2.57 69.0 Wallsend M.B. 47,318 13 1.28 2.38 72-4 Whitley Bay M.B. 38,388 13 1.58 2-86 142.4 Castle Ward R.D. 33,528 2 2.01 3.00 147-7 Gateshead C.B. 101,364 71 1.12 F90 79.4 South Shields C.B. 108,260 16 1.39 2.42 85.6 Blaydon U.D. 31,673 26 1.05 1.57 79.7 Chester-le-Street U.D. 20,008 8 1.31 211 84.5 Felling U.D. 38,847 2 1.25 2.35 77.7 Hebburn U.D. 25,070 2 1.33 2.59 75.9 Jarrow M.B. 28,871 1 1 -38 2.75 82.5 Ryton U.D. 14,480 22 1.20 1.98 85.8 Whickham U.D. 27,569 24 1.05 1.68 91.4 Chester-le-Street R.D. 45,171 16 1.04 1.88 76.9 Sunderland C.B. 219,076 46 1.41 2.52 85.5 Boldon U.D. 22,650 15 1.36 2.51 117.8 Hetton U.D. 17,137 1 0-97 F45 65.7 Houghton-le-Spring U.D. 31,498 5 1.17 2.20 79.2 Seaham U.D. 25,407 5 1.67 2.99 66.6 Washington U.D. 19,940 3 146 2.05 68.0 Consett U.D. 37,658 116 0.87 144 78.4 Stanley U.D. 44,923 39 1.06 1.61 70.2 Lanchester R.D. 14,718 12 1.21 F69 76.9 40 APPENDIX 1—continued

Observed Average Average 1114111ber price price of at at Index of 1966 fishing- 0-0125 1T.,0-04 Household Local Authority Area Populationl days2 per mile per mile Income3

Brandon and Byshottles U.D. 19,223 6 1 -16 2-05 66-1 Durham M.B. 24,247 7 1-36 244 122-9 Durham R.D. 37,230 3 1-34 2-63 79-2 Easington R.D. 86,245 5 1-33 2-48 70.6 Bishop Auckland U.D. 34,835 13 1-27 245 87-7 Crook and Willington U.D. 24,079 2 143 1-64 71-6 Shildon U.D. 13,909 23 0-93 1-75 734 Spennymoor U.D. 18,572 14 1-22 2-25 76-9 Tow Law U.D. 2,869 11 0.86 1-45 88-6 Sedgefield R.D. 35,250 5 1-55 2-84 75-8 Darlington C.B. 85,074 18 1 -36 2-69 87-2 Darlington R.D. 27,694 11 1-59 3-21 99.5 Croft R.D. 2,037 2 1-13 1-95 95-8 Teesside Borough 389,453 36 1-55 3-23 88-3 (Billingham U.D., Stockton-on-Tees M.B., Middlesbrough C.B., Eston U.D., Redcar M.B., Thomaby-on-Tees M.B.) Hartlepool C.B. 97,594 22 1-47 3-13 77-6 Stockton R.D. 11,746 4 243 3.09 113-3 Stokesley R.D., Northallerton U.D., Aysgarth R.D., Leyburn R.D., and Northallerton R.D. 42,983 , 3 1-58 3-39 111-7 Morpeth M.B. and Morpetli R.D. 31,640 10 1-46 2.67 90.9 Alnwick R.D., Amble U.D. and Alnwick U.D. 25,325 7 1-93 3-35 87-0 Rothbury R.D. 5,298 1 2-97 4-32 90-0 Hexham U.D. 9,951 27 1-09 1.65 1154 Prudhoe U.D. 10,680 34 1-09 1-56 71-4 Bellingham R.D. 5,137 2 1-20 2-19 76-9 41 APPENDIX 1—continued

Observed Average Average number price price of at at Index of 1966 fishing- 0.0125 0.04 Household Local Authority Area Populationl days2 per mile per mile Income3

Haltwhistle R.D. and Alston with Garrigill 9,000 1 115 2.03 75.0 Hexham R.D. 20,433 32 0.88 1.29 109.5 Startforth R.D. and Barnard Castle U.D. 9,388 11 F60 2.27 82.7 Barnard Castle R.D. 17,128 5 F51 2.47 71.8 Weardale R.D. 8,180 19 0.94 F37 914 Richmond M.B., Reeth R.D. and Richmond R.D. 32,273 18 149 248 84.7 Carlisle C.B. and Border R.D. 102,293 1 240 5.07 96.3 Appleby M.B.,Penrith U.D., Penrith R.D. and N. Westmorland R.D. 39,537 1 0.93 1.31 88.5 Tynemouth C.B. 72,817 22 1.31 2.38 98.9

1 Registrar General Statistical Review for England and Wales 1966, Part II, Tables, Population (London: H.M.S.0.). 2 From 10.03% sample of fishing-days taken during the 1970 season. 3 See: Cox, W. E. 'The Estimation of Income and Expenditures in British Towns', Applied Statistics' (Vol. 17) pp. 252-259.

42 APPENDIX 2

Observed Data on Day-Visitors

Observed Average Number Price Index of 1966 of per Household Local Authority Area Population' Visitor-days2 Visitor-day3 Income'.

Newcastle C.B. 251,131 256 0.37 90.6 Tynemouth C.B. 72,817 25 0.72 98.9 Haltwhistle R.D. 6,939 6 0.43 76.5 Ashington U.D. and Bedlingtonshire U.D. 56,888 6 0.91 70.6 Morpeth M.B. and Morpeth R.D. 31,640 13 0.63 901 Blyth M.B. 35,710 5 1.09 84.3 Gosforth U.D. 27,546 7 0.76 1431 Hexham U.D. 9,951 33 0.36 1151 Longbenton U.D. 47,595 5 0.80 92.9 Newbiggin U.D. 9,928 8 0.38 70.9 Newburn U.D. 31,518 9 0.53 84.8 Prudhoe U.D. 10,680 23 0.32 714 Seaton Valley U.D. 27,169 11 0.84 69.0 Wallsend M.B. 47,318 21 0.44 724 Whitley Bay M.B. 38,388 33 0.56 1424 Castle Ward R.D. 33,528 2 0.96 147.7 Hexham R.D. 20,433 55 0.25 109.5 Darlington C.B. 85,074 29 0.79 87.2 Gateshead C.B. 101,364 98 044 794 Hartlepools C.B. 97,594 16 147 86.2 South Shields C.B. 108,260 52 0.67 85.6 Sunderland C.B. 219,076 ,158 0.62 85.5 Teesside Borough 389,453 7 1.05 88.3 Barnard Castle U.D. and R.D. 22,507 8 0.52 76.3 Bishop Auckland U.D. 34,835 42 0.55 87.7 Blaydon U.D. 31,673 96 0.28 79.7 Boldon U.D. 22,650 14 0.77 117.8 Brandon and Byshottles U.D. 19,223 13 0.65 661 Chester-le-Street U.D. 20,008 40 046 84.5 43 APPENDIX 2-continued

Observed Average Number Price Index of 1966 of per Household Local Authority Area Populationl Visitor-days2 Visitor-day3 Income4

Consett U.D. 37,658 201 0.14 78.4 Crook with Willington U.D. 24,079 11 0.55 71.6 Durham M.B. 24,247 77 0.57 122.9 Felling U.D. 38,847 23 0.42 77.7 Hebburn U.D. 25,070 6 0.61 75.9 Hetton and Houghton-le-Spring U.D. 48,635 34 0.51 74.3 Jarrow M.B. 28,871 12 0.50 82.5 Ryton U.D. 14,480 24 0.44 85.8 Seaham U.D. 25,407 26 0.37 66.6 Shildon U.D. 13,909 11 0.39 734 Spennymoor U.D. 18,572 11 0.79 76.9 Stanley U.D. 44,923 68 0.30 70.2 Tow Law U.D. 2,869 7 0.45 88.6 Washington U.D. 19,940 18 0.56 68.0 Whickham U.D. 27,569 72 0.40 914 Chester-le-Street R.D. 45,171 41 0.52 76.9 Darlington R.D. 27,694 5 1.09 99.5 Durham R.D. 37,230 30 0.45 79.2 Easington R.D. 86,245 30 0.75 70.6 Lanchester R.D. 14,718 45 0.25 76.9 Sedgefield R.D. 35,250 18 0.57 75.8 Weardale R.D. 8,180 45 0.27 91.1

1 Registrar General Statistical Review for England and Wales 1966, Part II, Tables. Population (London: H.M.S.0.). 2 From a 52.5% sample of visitor-days on June 21 and 28, 1970 supplied by Mr.J. R. Atkinson, County Planning Officer, Durham County Council. 3 Computed using a constant mileage charge of k0.04 per mile. See: Cox, W. E. 'The Estimation of Income and Expenditures in British Towns', Applied Statistics, (Vol. 17) pp. 252-259.

44 APPENDIX 3 Sailing Club Members Number of Local Sailing Authority 1966 Club Local Authority Code Population Members

Newcastle C.B. 005 251,131 108 Tynemouth C.B. 006 72,817 16 Gosforth U.D. 007 27,576 18 Longbenton U.D. 008 47,595 9 Newburn U.D. 009 31,518 1 Seaton Valley U.D. 010 27,169 1 Wallsend M.B. 011 47,318 2 Whitley Bay M.B. 012 38,388 12 Castle Ward R.D. 013 33,528 26 Gateshead C.B. 014 101,364 14 South Shields C.B. 015 108,260 6 Blaydon U.D. 016 31,673 24 Chester-le-Street U.D. 017 20,008 16 Hebburn U.D. 019 23,070 1 Ryton U.D. 021 14,480 12 Whickham U.D. 022 27,569 15 Chester-le-Street R.D. 023 45,171 6 Sunderland C.B. 024 219,076 15 Boldon U.D. 025 22,650 8 Houghton-le-Spring U.D. 027 31,498 1 Seaham U.D. 028 25,407 6 Washington U.D. 029 19,940 1 Consett U.D. 030 37,658 68 Stanley U.D. 031 44,923 14 Lanchester R.D. 032 14,718 14 Brandon and Byshottles U.D. 033 19,223 9 Durham M.B. 034 24,247 21 Durham R.D. 035 37,230 5 Bishop Auckland U.D. 037 34,835 8 Crook & Willington U.D. 038 24,079 1 45 APPENDIX 3—continued

Number of Local Sailing Authority 1966 Club Local Authority Code Population Members

Spennymoor U.D. 040 18,572 5 Sedgefield R.D. 042 35,250 3 Darlington C.B. 043 85,074 23 Darlington R.D. 044 27,694 1 Teesside Borough 046 389,453 4 Morpeth M.B. 057 14,170 2 Alnwick R.D. 058 12,253 1 Hexham U.D. 064 9,951 14 Prudhoe U.D. 065 10,680 10 Hexham R.D. 068 20,433 51 Barnard Castle U.D. 069 5,379 4 Barnard Castle R.D. 070 17,128 3 Weardale R.D. 071 8,180 1 Richmond M.B. 076 7,190 3 Bedale R.D. 081 8,669 1 Thirsk R.D. 094 14,275 1 Carlisle C.B. 104 71,179 2 N. Westmorland R.D. 115 15,128 1 Other 999 18

592

46 APPENDIX 4

SAILING CLUB MAIL QUESTIONNAIRE .for Office Use Only

TO BE COMPLETED BY HEAD OF HOUSEHOLD OLEO

How far is your home by road from the Derwent Reservoir (One-way mileage)? • • miles. El=

How many times did you visit the sailing club during the four months April, May, June and July of this year? • • • • •• trips. LIE

When was your last trip to the sailing club? (please tick) LII before April, 1971

El April, 1971 LI

LII May, 1971

E June, 1971

LII July, 1971

How many people travelled together on the last trip you made to the sailing club in your own car (include all passengers plus the driver)? • • • • persons.

How many children are members of your household (up to and including 18 years of age)? • • • • persons.

What is your year of birth

• • after 1950 (please tick)? • • • •

ri 1941-1950

LII 1931-1940

El 1921-1930

•Cl 1911-1920

LI 1901-1910

E] before 1901

Please Turn Over 47 APPENDIX 4—continued

for Office Use Only How much did you and members of your Amount spent Amount spent household spend on your last visit to the within 5 miles in areas which sailing club (Please separate expenditures of the sailing are more than made within five miles of the sailing club club 5 miles from from those made further away)? the sailing club Food and drink purchased en route to and from the sailing club. . • • rial3-111 Food and drink purchased in clubhouse EFFIEE

Petrol and Oil purchased en route to and from the sailing club .. • • LJLJ I I_110

Please list any other expenditures incurred en route to and from the sailing club F1LJ 171E

How many hours do you work in a normal working week (please tick)? • • • • •• n do not work I I less than 30 31-35 ri 36-40 ri 41-45 ri 46-50 ri Over 50 Please indicate the approximate total annual income of your household (include, all income of household members, before tax) F--1 Under £1,000 ,1,001_,2,000 k2,001-k3,000 11 £3,001-‘4,000

L4,001—L5,000

-1 1 Over £5,000 Please add any comments you care to make. 48 APPENDIX 5

Summary of Responses to Sailing Club Mail Questionnaire RESPONSE First Questionnaire 263 Reminder 111

TYPE OF MEMBERSHIP Ordinary 174 Family 164 Junior 21 Student 8 Outport 7

LAST TRIP TO SAILING CLUB Before April, 1971 49 April, 1971 5 May, 1971 13 June, 1971 28 July, 1971 and August, 1971 279

NUMBER OF CHILDREN (up to and including 18 years of age) No children 164 1 child 55 2 children 93 3 38 18 4 PP 5 5 0 6 PP 7 1

YEAR OF BIRTH After 1950 30 1941-1950 90 1931-1940 84 1921-1930 106 1911-1920 44 1901-1910 14 Before 1901 5 Did not answer 1 49 APPENDIX 5—continued RESPONDENTS' TOTAL EXPENDITURES Food and Drink en route Within 5 miles 15.42 More than 5 miles away 55.08 Food and Drink in Clubhouse 221.07 Petrol and Oil en route Within 5 miles 5918 More than 5 miles away 159.52 Other Expenditures en route Within 5 miles 68.181 More than 5 miles away 2.87

HOURS WORKED PER WEEK Do not work 37 Less than 30 hours 11 31-35 28 36-40 115 . 41-45 65 46-50 56 Over 50 53 Did not answer 9

HOUSEHOLD ANNUAL INCOME Under J1,000 7 1,001-2,000 55 2,001-3,000 84 3,001-4,000 64 4,001-5,000 29 Over 5,000 67 Did not answer 68

1 This figure includes one response which listed J50 of other expenditures en route within 5 miles which distorts this particular observation.

50 Summary of Responses to Sailing Club Mail Questionnaire by Local Authority Areas

Observed Observed number of average Observed sailing-days transport average per 1,000 cost per Income of Local Authority Area population sailing-day participants

Newcastle upon Tyne C.B. 3.9612 0.3845 3385 Tynemouth C.B. 1.8265 0.3231 3125 Gosforth U.D. 3.9574 0.3184 4375 Whitley Bay M.B. 2.5008 0.3900 2500 Castle Ward R.D. 2.4177 0.3390 4056 Gateshead C.B. 1.6373 0.3150 3643 South Shields C.B. 0-2032 0.7829 3500 Blaydon U.D. 10.5468 0.1963 2600 Chester-le-Street U.D. 6.3500 0.3465 1375 Ryton U.D. 4.5587 0.2744 3333 Whickham U.D. 5.2233 0.2077 3071 Sunderland C.B. 0.4665 0.4380 3750 Boldon U.D. 1.8543 0.9777 3750 Seaham U.D. 19684 0.6009 1500 Consett U.D. 9.2445 0.1301 2833 Stanley U.D. .4.3844 0.2800 2667 Lanchester R.D. 14.4021 0.2168 3600 Durham M.B. 10.6834 0.4162 4038 Durham R.D. 0.8864 0.4635 5500 Bishop Auckland U.D. 1.4353 0.3733 4500 Spennyrnoor U.D. 3.8230 0.4680 2500 Sedgefield R.D. 0.3974 0.7665 1500 Darlington C.B. 1.8563 0.4551 4200 Hexham U.D. 8.8433 0.1909 2500 Prudhoe U.D. 11.9850 0.1698 2214 Hexham R.D. 23.5868 0.1646 3250 Barnard Castle U.D. 5.0195 0.4000 2500 Barnard Castle R.D. 0.9341 0.1782 5500 Richmond M.B. 0.4172 0.7534 3500

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