TABLE OF СONTENTS:

• Introduction…………………………………………………………………...3
• Methodology of the travel cost method……………………………………….4
• Improvements of the travel cost method (Empirical evidence) ………………8
• Conclusion ………………………………………………………………….13
• References…………………………………………………………………....14

Introduction

The change in the economic situation in the world actualizes attention to the problems of transport services, which is due to the trends of its development: increased responsibility for quality and terms of transportation throughout the supply chain; increase in the transportation of goods in a specialized rolling stock; toughening of requirements to time parameters of delivery of cargoes. For optimal use of the rolling stock, the forwarder has to make maximum efforts to ensure the reverse loading of the transport. Analyzing the current cargo flows, developing the schemes of optimal routing, the forwarder harmonizes the relations between the participants of the transport process in the supply chain, becomes a kind of "conductor" of the whole traffic flow, assuming full responsibility for the safety of the cargo and the observance of the terms of their delivery.

One of the tools that help in such situation is travel cost method (TCM). The travel cost method is a widely used technique for the valuation of recreation sites in the absence of organized markets. While it has been shown theoretically and empirically how travel cost can also be used to estimate the benefits from an improvement in environmental quality at recreation site, the method still needs some improvements.

That is why the purpose of the following paper is to analyze possible ways of improving travel cost method.

Conclusion

The travel cost method is regarded as the earliest technique to evaluate the non-market goods. It is commonly used to estimate the consumer surplus associated with travelling to the recreational sites such as parks, beaches and heritage sites.

Using this method, it is possible to determine the approximate values of prices at which the rural values will be consumed most, as well as the total demand for recreational services. This method allows us to predict the price at which the demand for recreational services will not be reduced.

Unfortunately, the main disadvantage of using this method in domestic practice is the imperfection of statistical information at the local level. The method of transport costs is very difficult to apply with respect to specific recreational areas (tourist bases, sanctuaries, sanatoriums in rural areas, parks), since there are no accounting data on the number of visits to a particular object or this information is closed.

In the second part of the work there were two improvements showed – one is done by Russian researchers, another one is done by American ones. First improvement is about applying travel cost method in logistics with the help of computer programs and is mostly aimed on the economic purpose for logistics companies.

Second improvement is about combination of revealed and stated preference data in the travel cost method in order to identify individuals’ preferences for a hypothetical quality improvement where no behaviour is observable.