Perspectives

Surf Economics

The Socioeconomics and Management of Surfing Areas: International Case Studies from Mexico, Spain, California and Australia

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Introduction
Surfing is a major recreational and economic activity involving intimate human interaction with diverse coastal environments. The rising popularity of surfing in many countries and significant growth in participation has increased the economic contribution of surfing to local communities. Despite the popularity of surfing, it is often challenging for the sport to be taken seriously in coastal management decisions. Surfing and surfers are very sensitive to environmental conditions and changes in environmental conditions and water quality can negatively impact surfing. At present there is little research on the value of recreational surfing even in traditional locations such as the east coast of Australia and in California, where it is estimated that over three million people surf on a regular basis. To make informed decisions, coastal professionals require information about the users that will be affected by coastal policies and activities. In recent years, there has been an increase in research on the economics and management of surfing.

This paper presents plans for and findings of investigations using multidisciplinary techniques that include economic valuation techniques and social and historical research to understand the value of surfing in California, Mexico, Australia and Spain. The findings demonstrate the significant economic, social, environmental and cultural importance of surfing amenity to specific locales and support the need for consideration of the impacts to surfing that may occur as a result of coastal management decisions.

Ensenada, Baja California, Mexico (Paula Pijoan)
Ensenada, Baja California has been an important surfing area since as early as the 1940s with visitation increasing rapidly from the 1960s to the present. Both local surfers and those from Southern California regularly frequent surfing areas surrounding Ensenada.

To better understand the importance of surfing to the City of Ensenada, Baja California, Mexico an integrated study of the economic contribution of surfing to the city is currently being conducted. The study will also include an analysis of the economic value (consumer surplus) of surfing in Ensenada.

The study area encompasses six surf breaks near the city of Ensenada, most of which are mainly frequented by local users, and one in particular, San Miguel, is highly visited by surf tourists originating from places outside of the Mexico.

The study consists of four components. First, an assessment of each surf break will be conducted. The assessment will gather descriptive information for each surf break. Second, a survey will be conducted on a sample of users to develop a socioeconomic profile of local users that includes their perceptions of beach conditions; travel and equipment expenses; and a pilot stated preferences survey to gather data on willingness to pay for preservation of the existing surf breaks. Third, the consumer surplus of the San Miguel surf break will be estimated using the travel cost method. Fourth, the information gathered on the conditions, perceptions, economic impacts and economic values will be used to develop proposed management strategies to sustain surfing in Ensenada.

Mundaka, Spain (Melissa Murphy and Maria Bernal)
Mundaka is the quintessential historic Spanish fishing village, small and unassuming with rich heritage and beautiful landscapes. It is located in one of the oldest provinces in Northern Spain’s Basque Country and resides inside the Urdaibai Biosphere Reserve. Home to approximately 1,900 people, Mundaka’s number one source of revenue is tourism based primarily on the growing Biosphere Reserve’s nature-based tourism market and a thriving surf tourismmarket, which draws both domestic and international visitors.

Mundaka’s famous surfing wave brings thousands of surf tourists to the small village and the annual Billabong Pro is one of only 12 stops on the prestigious Association of Surfing Professionals World Tour. Approximately 30,000 visitors are attracted to the tiny town each year, many of whom come to watch the surfing contest. The famed wave that attracts these visitors to the village is a 400 meter long left hand tube that is naturally formed by a sandbar. The Biosphere Reserve has helped protect this coastal area from major development and pollution issues, but a river dredging project to allow for large ship transport resulted in significant degradation of the wave in 2005, forcing the cancellation of the Billabong Pro surfing contest. The cancellation of the event is believed to have had a significant negative effect on the local economy. The natural sandbar has slowly returned, bringing with it improved wave quality over the past two years, but if the ships being built upriver continue to grow in size, river dredging will once again affect surf quality. Without knowing the value of the wave or the impacts that surfing has on the local economy, the local surfing-related economy and culture has had a difficult task fighting decisions that may detrimentally affect it.

To answer these questions and provide a tool for defending coastal resources and local surf culture, Save The Waves Coalition commissioned a study in 2007 to look at the economic impact of surf tourism on the local economy of Mundaka, Spain. Approximately 155 surf market participants were surveyed over a three-and-a-half month period beginning in September 2007. The survey period covers the time that the Billabong Pro surfing event is being run. Data collected focused on surf tourist spending habits as well as personal and trip characteristics.

Preliminary analysis shows that the majority of surf tourists visiting the area, on average, are male, thirty years old, stay between one and two days and spend between $100 and $200 per trip. While most claim that they would continue to visit Mundaka if the Billabong Pro contest was no longer held there, they would not continue to visit if the wave was permanently degraded. Through personal interviews and an online survey, local businesses estimated a 50% drop in business due to the loss of the wave and subsequent cancellation of the contest in 2005.

Further analysis of the data will be conducted through the creation of an Economic Impact Analysis (EIA) study, to measure the actual and potential economic impact of surf tourism on the local economy. The project will be completed in June 2008.

Trestles, California, United States of America (Chad Nelsen)
In 2000, the last year for which we have data, Californians spent more days surfing in local coastal waters (22.6 million days) than they spent fishing, diving, or kayaking (Leeworthy and Wiley 2001). Despite the popularity of surfing, it is often challenging for the sport to be taken seriously in coastal management decisions.

To make informed decisions, coastal professionals require complete information about the users and constituents that will be affected by coastal policies and activities, especially those that involve development and pollution. Surfing is particularly sensitive to environmental changes that can result from development or coastal pollution. Surf breaks are the result of complex interactions of shoreline structure, bottom conditions, and wave energy (Scarfe et al. 2003; Walker 1974). Small perturbations in the local bathymetric conditions can change the quality of surf breaks. Unavoidably, surfers are literally bathed in coastal water and many surfers leave the ocean with their sinuses filled with seawater. These waters often contain pollutants, including human pathogens, that are known to cause illnesses in swimmers generally (See Given et al. 2006; Wade et al. 2006 for a review) and surfers specifically (Dwight et al. 2004).

One reason so little is known about surfers is that surfers are difficult to survey. Random telephone surveys are impractical because surfers are not present at sufficiently high densities in the general population (Hanemann et al. 2004; Shaw and Jakus 1996). Surfers have also proven difficult to intercept during in-person interviews at beaches (P. King, personal communication, April 17, 2007). As a result, surfers have been grouped within the general class of beach goers in coastal economics research. Distinguishing surfers from other beach goers is important because surfers have unique interests, visitation behaviors, and demographic characteristics that affect the economic impacts of surfers on local economies.

Surfers attracted to Trestles generate economic impacts that contribute to the local economy of the City of San Clemente. Surfers visiting Trestles provide economic input to the local economy by spending money at restaurants, shopping, buying gas, rentals and other beach-related incidentals. Over 83% of the surfers visiting Trestles originate from outside the City of San Clemente and represent an import of expenditures to the City. The average surfing-related expenditure per-person per-visit for surfers visiting Trestles was $40.07 (in 2006 dollars). This expenditure level is comparable to other recent studies on the expenditures of beach goers.

The San Onofre State Park keeps attendance records of surfers and beach-goers visiting Trestles using a methodology that bases the daily attendance on head counts, a turn-over rate, weather and surf conditions. They report that in 2006 there were approximately 367,000 visits to the Trestles; 90% were surfers (California State Parks, personal communication, August 23, 2007). Annual surfer visits for 2006 was approximately 330,000. We cannot extrapolate our findings to the total population of surfers because our sample is not random. Using $25 as a conservative value from Hanemann et al. (2004) and $40 found in our survey we estimate a range for the annual economic impact to the City of San Clemente from surfers visiting Trestles that could be from $8 million/year to $13 million/year.

Estimation of the economic value (consumer surplus) for Trestles Beach is in progress.

Bastion Point, Kirra and South Stradbroke Island, Australia; Chile and the United States of America (Neil Lazarow)
Over the past three decades, surfing has expanded, both in intensity in traditional locations, and in reach into new environments often in the developing world. As a result, surfing requires an increasing use of coastal resources. Surfing has substantial economic and social value to various regions necessitating a pivotal role in coastal planning and management regimes now and into the future.

While there is a growing literature on the value of surfing tourism, especially in the Indo-Pacific region and surrounding the development of artificial surfing reefs, there is little documented evidence of the value of recreational surfing in more traditional locations such as Australia and the USA. Over two-and-a-half million Australians (Surfing Australia 2006) and three-and-a-half million Americans (Leeworthy et al. 2005) are reported to surf on a regular basis. With increasing participation, surfers are likely to be more involved in conflicts with other users and coastal activities. Understanding the value of surfing relative to other recreational activities and resource requirements highlights and can transparently help resolve such conflicts.

This research project describes the types of impacts that might affect surfing (see Table 1) and then provides an overview of our current understanding of the socio-economic value of surfing. Not enough is known about surfing to ensure that surfing issues are adequately considered in coastal planning and management decisions. Results of a study into the market and non-market values of surfing at Bastion Point, Kirra and South Stradbroke Island, as well as a national survey in Australia; and national surveys in the USA and Chile are presented and compared with existing studies. Surfing amenity is found to have significant economic, social and cultural importance. Being able to clearly articulate and measure changes in recreational amenity is paramount for improved decisions over the use of coastal environments. Alongside more familiar costs and benefits, there is a need to consider any negative impacts on surf breaks and the natural environment that may occur as a result of planning, development and coastal protection works.

Table 1: Typology of Surfing Capital

Wave quality

Description - Dominant local view of how the wave breaks. Both beauty and physical form become assessable
Natural or human impact
- Construction of coastal protection/amenity structures (e.g. groynes, seawalls, piers, seawalls, river walls, breakwaters, artificial reefs)
- Sand management (e.g. beach fill, dredging, sandbar grooming)

Wave frequency

Description - ‘Surfable’ waves measured against an accepted standard.
Natural or human impact
- Construction of coastal protection/amenity structures (e.g. groynes, seawalls, piers, seawalls, river walls, breakwaters, artificial reefs)
- Sand management (e.g. beach fill, dredging, sandbar grooming)

Environmental

Description - Environmental or biophysical conditions that may mitigate against a surfers’ physical health
Natural or human impact
- Biological impacts (e.g. water quality or nutrient loading)
- Climate change/variability (e.g. temperature change, sea level rise, less or more storms less or more often)
- Amenity of the surrounding built and natural environment
- Marine predators (e.g. sharks)

Experiential

Description - Societal conditions surrounding the surfing experience
Natural or human impact
- Legislation/regulation that might grant, restrict or control access (e.g. community title, private property, payment strategies, craft registration, proficiency requirement, policing)
- Code of ethics i.e. road rules for the surf
- Signage & education strategies
- Surf rage, aggression, intimidation
- Self-regulation/localism/lore
- Mentoring, sharing, physical activity, challenge, joy and laughter, well-being, community spirit, Self-fulfilment
- Local aesthetic

Conclusion