For backpackers seeking adventure in Central America, both Panama and Costa Rica offer unique experiences, but they differ significantly in travel costs. Generally, Panama is known for being the more budget-friendly option. Hostel prices in Panama City range from $10 to $20 per night, while smaller towns like Boquete offer even cheaper accommodations. In contrast, Costa Rica's hostels often start at around $15 and can go up to $30, particularly in tourist hotspots like La Fortuna and Manuel Antonio. This difference can significantly impact a backpacker’s overall budget, especially for those planning to stay longer.

Food costs also vary between the two countries. In Panama, street food is abundant and affordable, with meals costing as little as $3 to $5. Local eateries, known as "fondas," provide hearty meals for a low price. Conversely, while Costa Rica also offers affordable dining options, prices tend to be higher, with meals in sodas (local diners) typically ranging from $5 to $10. This means that while both countries can satisfy a budget-conscious traveler, Panama may provide more bang for the buck when it comes to food.

Transportation is another key factor in the cost comparison. Panama's extensive bus network is efficient and inexpensive, with fares between cities often costing less than $5. In Costa Rica, although buses are still a budget-friendly option, prices can be slightly higher, particularly for routes to popular destinations. Additionally, Costa Rica’s attractions often charge entrance fees that can add up, while many of Panama's natural sites, like hiking trails and beaches, are more accessible and often free. Overall, for backpackers looking to stretch their dollars further, Panama tends to offer a more economical travel experience compared to Costa Rica, while still providing a rich array of adventures and cultural experiences.