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1. Calculation of Intrinsic Value of River Preservation
2. Analysis of Environmental Group Membership
3. Shortcomings with Methodology
The Buffalo River has value beyond its economic value -- people care that it be preserved for its own sake, even if they do not use it commercially or recreationally. People derive value from the river's existence, from the knowledge that by preserving it they can bequeath it to their heirs, and from the effect that protecting this river has on protecting other natural resources. We summarize those benefits in the term "intrinsic value," and here we assign an economic value to it, by counting local membership dues in environmental groups. The intrinsic value estimated from this technique is $6.0 million per year.
Calculation of Intrinsic Value of River Preservation
We estimate the intrinsic value of the Buffalo National River by counting the dues paid by members of environmental groups within the area. The theoretical basis is that all of those people would agree that their dues could be used exclusively for BNR preservation, if their group so asked, and hence their dues are a "revealed preference." The basic calculation to estimate the intrinsic value is to multiply the amount of dues, times the number of people in environmental groups within the area. We arranged our selection criteria so that our result would be conservative, i.e., this intrinsic value represents a lower limit on the true intrinsic value.
Environmental Dues Near BNR Table G-1
Date Nationwide Membership Annual Total dues
Environmental Group founded Membership near BNR Dues near BNR
Greenpeace USA 1971 1,600,000 48,426 $30 $1,452,789
Nat'l Wildlife Fed. 1936 1,300,000 66,095 $16 $1,057,512
World Wildlife Fund 1961 1,200,000 37,263 $15 $558,944
Nature Conservancy 1951 724,000 29,510 $25 $737,742
Nat'l Audubon 1905 600,000 24,198 $35 $846,916
Society
Sierra Club 1892 550,000 22,303 $35 $780,612
Wilderness Society 1935 290,000 12,206 $15 $183,084
Env. Defense Fund 1967 250,000 9,531 $20 $190,625
Nat. Res. Def. 1970 170,000 3,727 $10 $37,273
Council
SC Legal Defense 1971 150,000 7,005 $10 $70,050
Fund
Defenders of 1947 85,000 3,524 $20 $70,482
Wildlife
Totals 6,919,000 263,787 $5,986,030
The definition of "environmental group" is membership in one of the top 11 national groups. We excluded local groups because their dues, we thought, would represent more of a recreational use value than an intrinsic value (we considered including the Ozark Society, but omitted them to keep the estimate conservative). For the same reason, we excluded membership in groups with purposes other than strictly environmental, such as Ducks International. Hence our choice of groups makes our estimate conservative (i.e., the true intrinsic value may be higher, but we can say with fair certainty that it will not be lower than our estimate). The definition of "11 largest groups," and the amount of dues, is from Outside Magazine (March 1994, pp. 67ff). We chose 11 groups as the cutoff because that includes every group which represents more than 1,000 people within the area (the 12th largest national group, Conservation International, would only add about 460 members within the area).
The definition of "within the area" is limited to states which constitute the primary visitorship to the BNR We chose AR, TX, OK, LA, and MO, based on frequency of visitorship from survey data from three different concessionaires (the same data used for the TCM analysis, see Appendix F). The next states in line would have been KS, TN, MS, and IL, in that order, but we omitted them for reasons discussed below.
The "within the area" definition is based on metropolitan areas within 300 miles of the BNR. "Within 300 miles" is estimated by measuring map distances, which are air miles, so actual driving miles would be around 350 miles for the radius we chose. We chose that radius because we saw that it encompassed the most common origin points, and because points at the edge of the radius were common origin points for visitors.
We counted the entire membership of AR, OK, and MO, because almost all of their major population centers fall within a 300-mile radius (only northern MO and the OK panhandle do not). The parts of those states which are not within 300 miles are counter-balanced by the parts of KS, TN, MS, and IL which are within 300 miles, but which are not counted.
For TX and LA, we estimated the population of the states which fell within 300 miles. To do so, we counted the major population centers which fell within the radius, and based our estimate on their proportion to the total population of the state. For TX, we counted 33% of membership as within the 300-mile radius, and for LA, we counted 58%.
Membership by State, Near BNR Table G-2 Environmental Group Arkansas Missouri Texas Oklahoma Louisiana Greenpeace USA 3,267 17,648 56,433 4,834 6,865 Nat'l Wildlife Fed. 5,000 32,000 42,692 12,874 3,528 World Wildlife Fund 3,371 14,967 33,917 4,770 5,062 Nature Conservancy 3,750 10,000 23,200 5,130 5,150 Nat'l Audubon 3,243 8,054 20,088 3,945 4,017 Society Sierra Club 1,424 10,870 19,233 1,962 2,907 Wilderness Society 1,359 4,951 10,333 1,544 1,612 Env. Defense Fund 854 3,901 8,210 1,381 1,171 Nat. Res. Def. 365 1,530 3,301 441 517 Council SC Legal Defense 708 2,661 6,645 852 1,011 Fund Defenders of 298 1,377 3,168 478 560 Wildlife Total Membership 23,639 107,959 227,220 38,211 32,400 Total Population 2,399,000 5,193,000 17,656,000 3,212,000 4,287,000 % within 300 miles 100.0% 100.0% 33.4% 100.0% 56.1%
Analysis of membership patterns
Our methodology required that we collate the national membership of environmental groups and their membership in the states in the region. Based on that data, we summarized whether the states in the area were above or below the national average of membership levels. Table G-1 indicates the national membership levels, and Table G-2 indicates the state membership levels of national environmental groups. Table G-3 indicates the level of state membership, as a percent of the expected level (if membership were perfectly even across states, the membership level would be 100%; above 100% means the state membership for a group is above the expected level; the further below 100%, the further below the expected level).
All five states are well below the national average in membership in environmental groups. Missouri does the best of the five, at 77% of the expected number of members based on state population. The other four weigh in at less than half of their expected membership. We assume that this reflects that environmental organizations are primarily "bicoastal." Arkansas is at 36% of their expected membership, which indicates a low level of environmental concern. This low level might be considered when making environmental policy in Arkansas. On average, membership is about half of the expected membership, for all environmental groups.
Percent of Expected Membership Table G-3 Environmental Group Arkansas Missouri Texas Oklahoma Louisiana 5 states Greenpeace USA 21.7% 54.2% 51.0% 24.0% 25.5% 43.4% Nat'l Wildlife Fed. 40.9% 120.9% 47.4% 78.6% 16.1% 57.6% World Wildlife Fund 29.9% 61.3% 40.8% 31.6% 25.1% 40.3% Nature Conservancy 55.1% 67.8% 46.3% 56.3% 42.3% 50.8% Nat'l Audubon 57.5% 65.9% 48.4% 52.2% 39.8% 51.1% Society Sierra Club 27.5% 97.1% 50.5% 28.3% 31.4% 51.5% Wilderness Society 49.8% 83.9% 51.5% 42.3% 33.1% 53.2% Env. Defense Fund 36.3% 76.6% 47.4% 43.9% 27.9% 48.3% Nat. Res. Def. 22.8% 44.2% 28.1% 20.6% 18.1% 28.2% Council SC Legal Defense 50.2% 87.1% 64.0% 45.1% 40.1% 61.7% Fund Defenders of 37.3% 79.6% 53.8% 44.7% 39.2% 53.9% Wildlife Average for all 36.3% 76.6% 47.4% 43.9% 27.9% 48.3% groups
Shortcomings of our intrinsic value methodology:
1) Many people join multiple environmental groups. We count their dues for as many groups as they join, since their revealed preference is higher than people who join only one group. Hence we do not consider multiple membership to be a problem with our estimation technique.
2) Memphis is not counted as "within the area," even though it's only 150 miles away, because TN is excluded. We omitted TN because we saw few visitors from there (perhaps because the connecting roads are poorly laid out to make an easy drive). Once again, this omission makes any error on the side of keeping our estimate low. All other major population centers within the area are counted.
3) People in rural settings tend not to join environmental groups (that is, membership is primarily an urban base). This potentially underestimates our intrinsic value significantly, since rural non-members have a value that is not reflected proportional to their urban counterparts. This underestimate is demonstrated by the low proportional membership discussed in Recommendation 5.3 and in the discussion concerning Table G-3.
4) Dues are not always accurate. Some groups do not charge a fixed amount of dues. For example, the National Wildlife Fund has a minimum dues of $16, but an actual average of $35, according to its Arkansas chapter. We count the basic dues, which means we are once again making a conservative estimate.
5) Membership numbers are not always accurate. For example, the Sierra Club headquarters reported AR membership at 1,424, but the AR membership personnel estimate it at 1,600 to 2,000. We used the national numbers, but don't know if the errors will bias our result up or down. We assume the effect is small.
6) The Environmental Defense Fund does not keep membership figures by state. The National Wildlife Federation does not keep membership figures at the national level, and the Texas office was unreachable. Both of those membership figures were estimated by assuming membership proportional to each state's membership for other groups. We don't know if the estimations will bias our result up or down, but we assume the effect is small.