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<br />.. <br /> <br />calculated. From this, the incremental WTP for an additional cfs or acre foot of water can be <br />calculated and compared to the economic value of foregone out of stream water uses. For an <br />example of the application of travel cost method to instream flow see Ward, 1987. <br /> <br />Another commonly applied technique to estimate both the recreational value of instream flow <br />and the general public's benefits of preserving flows for T&E fish, involves use of a <br />"constructed market" or "simulated referenda". This approach is known as the Contingent <br />Valuation Method (Mitchell and Carson, 1986). Essentially, a hypothetical market is <br />constructed which allows anglers or the public to buy higher levels of instream flow. They <br />are told they would pay through higher electricity costs or a higher water bill or in some <br />cases through higher taxes. The specific details of the market are clearly spelled out using <br />hydrographs, written descriptions or photos (Loomis and Feldman, 1995). In a constructed <br />market the individual can either be asked the maximum they would payor whether they <br />would pay a given amount that varies across respondents. In the simulated referenda, <br />households are asked if they would vote in favor of the specific increase in instream flow at <br />a particular dollar amount. that varies across households. By measuring the percentage of <br />people that "buy" or vote yes at each dollar amount, a demand curve like relationship can be <br />statistically estimated. From this equation, the expected value or mean WTP can be <br />calculated. Much of the motivation of non-visiting households willingness to pay for instream <br />flow is related to their "existence" value from knowing the species will continue to exist in <br />its natural habitat and a "bequest" value from knowing preservation today provides future <br />generations with these species. <br /> <br />9 <br />