Cleaner Lakes, More Visitors and Economic Benefits

Daniel Otto, Faculty, Economics

Situation:

The state of Iowa is interested in improving water quality in the states lakes and streams.  The DNR has limited budget for restoration efforts and needs to demonstrate value of this work and to develop local partners.  Research conducted by Profs. Cathy Kling and Joe Herriges at ISU and funded by NSF and Iowa DNR has demonstrated that water clarity in Iowa lakes is linked with higher levels of lake usage.  Higher usage means more recreational spending and local economic impacts.  To make the connection of how the local economy can benefit from improving lakes, additional research was needed on what visitors spend.  Estimating these impacts by lakes will be useful in promoting further lake restoration work at the state level and with local policy makers.

Objective:

Provide estimates of local economic benefits from improving water quality of local lakes


Activities/Output:

Research funded by DNR and NSF has provided estimates of visitation rates and usage patterns at Iowa lakes. These visitation rates have been identified as linked to water quality.  I have been directly involved in estimating local economic impacts of lake visitations.  Local spending estimates were developed by estimating direct spending by visitors at Iowa lakes based on surveys of visitor to Storm Lake and Rock Creek Lake in summer 2002 and Michigan State University Tourism Center surveys of lake visitors.  The Iowa Input-Output model was used to estimate additional secondary impacts in the local economy from the initial direct expenditures.  These results are being posted to an economic impact page for 36 top priority lakes on the Iowa Lakes website.

Impact/Outcomes:

The information on local impacts from visitors to Iowa lakes has helped increase the Iowa DNR budget for lake restoration efforts.  The economic impact information is helpful for working with local groups to develop local matches and increasing local political support for their lake restoration efforts.

July 2007
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Page last updated: August 2, 2007
Page maintained by Linda Schultz, lschultz@iastate.edu