A Suggested Basis for Pricing Campsites: Demand Estimation in an Ontario Park

Camping season at a public park is divided into groups of days (experience types) that exhibit different demands. The consumer surplus and demand for each type is estimated by Pearse's method. Experience types are treated as jointly produced goods from a physical campsite, and the composite demand curve for campsites is obtained by vertical summation of the demand curves for each experience type. Marginal benefits of the campsites are equated with average costs of construction being incurred by park authorities to determine the optimal number of campsites for the park. Based on the results, a discriminatory pricing system is suggested so that camping fees will more accurately reflect the marginal benefits of the last campsite on any given day.