Estimating and comparing demand for a music event using stated choice and actual visitor behaviour data

ABSTRACT

Understanding the demand and the economic impact for a hallmark event is crucial knowledge not only for the event managers but also for the public planners of the host region, especially from the viewpoint of welfare evaluation. The purpose of this paper is twofold. Firstly to estimate the demand for a music event using two non-market valuation techniques; stated choice and travel cost method (TCM), and secondly to compare the welfare measures estimated from the two methods and discuss their relevance for event policy and management. We use survey data collected from 1005 visitors to the Peace & Love music festival held in Borlänge, Sweden, in 2012. The survey contains questions about the actual behaviour of the respondents such as expenditure patterns and travel behaviour but also a stated choice experiment (SCE). The latter asks the respondents to choose between different scenarios with varying levels of price, number of visitors and length of the festival in days. These data allow us to estimate consumer surplus for the event by applying both the TCM and SCE. The findings of our study are that the price effect, as expected, is negative and significant, more people attending the festival decreases the propensity to attend while longer duration of the festival increases the propensity to attend. This paper contributes to the literature on event impact analysis by highlighting the potential for using stated choice data on visitor preferences in combination with actual visitor data to understand current and future economic impact of an event.

KEYWORDS:

• Travel cost method
• stated choice experiment
• tourism impact
• music festival

Acknowledgements

We thank two anonymous reviewers for valuable comments and suggestions to improve the manuscript. Janis Gailis and Patrik Arousell are thanked for assisting us with data. Participants at the symposium on Estimating the impacts of tourism and events, Centre for Tourism at the University of Gothenburg, March 20, 2014 are thanked for valuable comments and suggestions.

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

1. These are the different values of time that are used by the Swedish Transport Administration when they do cost benefit analyses of infrastructure investment projects.