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Gains from investments in snowmaking facilities

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  • Falk, Martin
  • Vanat, Laurent

Abstract

The process of making snow requires low temperatures as well as vast quantities of water and considerable amounts of energy for the air compression. In this article the effectiveness of investment in snowmaking systems is investigated (equipment, construction works) based on data for 109 French ski resorts covering eight winter seasons (2006/2007 to 2013/2014). Both static and dynamic panel data estimations show that ski areas with large investments in snowmaking systems have a higher number of skier visits. On average a 10% higher capital stock of snowmaking infrastructure leads to an increase in the number of skier visits by 8% over the winter seasons studied. However, positive effects of snowmaking can only be observed for ski areas located at high elevations, with a magnitude deceasing by higher cumulated investments in snowmaking, indicating diminishing returns to scale. Ski areas at lower elevations, benefit effectively from snowmaking to a lower degree and only in extremely dry or snow poor winter seasons.

Suggested Citation

  • Falk, Martin & Vanat, Laurent, 2016. "Gains from investments in snowmaking facilities," Ecological Economics, Elsevier, vol. 130(C), pages 339-349.
    • Handle: RePEc:eee:ecolec:v:130:y:2016:i:c:p:339-349
    DOI: 10.1016/j.ecolecon.2016.08.003
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    Cited by:

    1. Parthum, Bryan & Christensen, Peter, 2022. "A market for snow: Modeling winter recreation patterns under current and future climate," Journal of Environmental Economics and Management, Elsevier, vol. 113(C).
    2. Yan Fang & Yiyi Jiang & Chin-Hsun Ken Tsai & Binghao Luo & Ming-Hsiang Chen, 2021. "Spatial Patterns of China’s Ski Resorts and Their Influencing Factors: A Geographical Detector Study," Sustainability, MDPI, vol. 13(8), pages 1-16, April.
    3. Aurélie Corne & Olga Goncalves & Nicolas Peypoch, 2020. "Evaluating the performance drivers of French ski resorts: A hierarchical approach," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 41(3), pages 389-405, April.
    4. Matthias Firgo & Oliver Fritz, 2017. "Does having the right visitor mix do the job? Applying an econometric shift-share model to regional tourism developments," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 58(3), pages 469-490, May.
    5. Firgo, Matthias & Kügler, Agnes, 2018. "Cooperative pricing in spatially differentiated markets," Regional Science and Urban Economics, Elsevier, vol. 73(C), pages 51-67.
    6. Martin Falk & Sigbjorn Landazuri Tveteraas, 2020. "Modelling the wider effects of ski lift investments," Empirical Economics, Springer, vol. 59(1), pages 259-274, July.
    7. Daniela Kletzan-Slamanig & Claudia Kettner-Marx & Franz Sinabell, 2020. "Umsetzung der Wasserrahmenrichtlinie in Österreich. Aktualisierung der ökonomischen Analyse der Wassernutzung," WIFO Studies, WIFO, number 67012, January.
    8. Robert Steiger & Eva Posch & Gottfried Tappeiner & Janette Walde, 2020. "Effects of climate change on tourism demand considering individual seasonal preferences," Working Papers 2020-08, Faculty of Economics and Statistics, University of Innsbruck.
    9. Steiger, Robert & Posch, Eva & Tappeiner, Gottfried & Walde, Janette, 2020. "The impact of climate change on demand of ski tourism - a simulation study based on stated preferences," Ecological Economics, Elsevier, vol. 170(C).

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