An economic analysis of the Smith River float lottery

Abstract

Outdoor recreation is a popular pastime for many and provides an opportunity to unwind and take a break in nature and on public resources. In recent years, overcrowding and commercial use have been highlighted in the media for taking away from the recreational experience and stressing some of the resources. To explore this issue, I collect data on float permit application numbers over 15 years for the Smith River, which is a popular lottery accessed recreational river in Montana that receives over 10,000 float applications per year and also allows private commercial guiding. To attempt to gain insights into whether commercial use is viewed negatively, I use variation in the number of outfitted trips that are permitted to launch each day within the float season to identify how outfitter use impacts application rates. I find that application rates during the peak season decrease by an average of 11 percent on days in which two outfitters launch compared to days when only one outfitter can launch. Because outfitter launch allocations effect the supply of permits available in the lottery, this result could be attributed to either an outfitter effect or supply effect. Further analyses that test the differences between the early season when outfitter use is low, and the peak season when outfitter use is high, indicates that there is a combination of both effects, but that the impact of outfitter use is large and significant.