Economic Analysis of the Potential Impact of Climate Change on Recreational Trout Fishing in the Southern Appalachian Mountains: An Application of a Nested Multinomial Logit Model

Global warming due to the enhanced greenhouse effect through human activities has become a major public policy issue in recent years. The present study focuses on the potential economic impact of climate change on recreational trout fishing in the Southern Appalachian Mountains of North Carolina. Significant reductions in trout habitat and/or populations are anticipated under global warming since the study area is on the extreme margins of trout habitat of the eastern U.S. The purpose of this study is to estimate the potential welfare loss of trout anglers due to global warming. A nested multinomial logit model was developed and estimated to describe the angler's fishing choice behavior. The estimated median welfare loss (Compensating Variation) ranged from $5.63 to $53.18 per angler per single occasion under the various diminished trout habitat and/or population scenarios.