The Economic Benefits of Recreation in Canada

https://doi.org/10.1111/caje.12560

Lloyd-Smith, P. (2021) The Economic Benefits of Recreation in Canada. Canadian Journal of Economics. 54 (4) November. https://doi.org/10.1111/caje.12560

Canadians spend approximately 2.2% of the country's gross domestic product on outdoor recreation, but we do not yet know the economic benefits people receive from participating in these activities. I provide the first ever comprehensive assessment of the economic benefits of outdoor recreation in Canada. I use a nationally representative survey of recreational behaviour on over 24,000 Canadians to estimate a Kuhn–Tucker demand model that accounts for substitution between activities and satiation in demand. The results demonstrate that participation in outdoor recreation provides Canadians with $98 billion in annual economic benefits, which is well over twice as large as reported expenditures. I also reveal substantial heterogeneity in recreation benefits across activities and regions in Canada.