ECONOMIC VALUATION OF A RIVER CORRIDOR: INTEGRATION OF
NATURAL RESOURCE AND DEVELOPMENT ECONOMICS
BY
FRED J. HITZHUSEN, RADHA AYALASOMAYAJULA, AND SARAH
LOWDER
PREPARED FOR THE AUGUST 1999 ANNUAL MEETING OF THE
AMERICAN AGRICULTURAL ECONOMICS ASSOCIATION, NASHVILLE,
TENNESSEE
hitzhusen.1@osu.edu; ayalasomayajula.1@osu.edu; lowder.7@osu.edu
2
Economic Valuation of a River Corridor:
Integration of Natural Resource and Development Economics
Introduction
Rivers have the potential to play an important role in the development of an economically
depressed region by providing water supply, transportation, waste assimilation, and a wide array
of recreation and tourism activities. The Muskingum River, which flows thorough Coshocton,
Muskingum, Morgan and Washington Counties in Southeastern Ohio, provides an example of
the roles a river can play in regional development. Throughout the length of the river are ten sets
of locks and dams that were constructed between 1837 and 1841 to facilitate transport of
products by barge (Woolpert 1993). The original features of the locks have been maintained
throughout the century, making them an interesting attraction for boaters and fishermen as well
as for tourists, even though little cargo moves through them now.
Several local officials have expressed concern that the Muskingum River is underutilized,
but has the potential to become a more popular tourist attraction and catalyst for economic
growth. Over the years, the condition of the river corridor has deteriorated and information is
needed to determine the economic feasibility of various options for restoring and upgrading the
corridor. Traditionally, development economics has focused on growth in private market
activities whereas natural resource economics has focused on non-market valuation of natural
resources and the environment. An increase in private market activities related to natural
resources such as rivers and improved methods of non-market valuation make it possible for
stronger complementarity of natural resource an