Revenues and the Cost of Collecting Recreational Fees

Abstract

This study examines the cost of collecting recreational fees at US national parks and its relation to the number of visitors and the fee revenue collected. The fitted second-order polynomial regression model indicates that the cost of fee collection is indeed a function of fee revenue but is not correlated with the number of visitors. It seems to agree with the parabolic portion of a typical total cost curve where the cost of collection per dollar of revenue diminishes with higher revenue. A cluster analysis underscores the findings of the regression analysis. Further analysis indicates that federal land agencies that make more use of differential pricing schemes benefit from a lower collection cost per dollar of fee revenue.