International Choice Modelling Conference, International Choice Modelling Conference 2017

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Value of travel time as a function of comfort
Gerard de Jong, Marco Kouwenhoven

Last modified: 28 March 2017

Abstract


There is abundant literature on the value of travel time (VTT). The VTT for project appraisal can be defined as the opportunity cost of travel (not spending more time at the origin or destination) minus the direct utility from spending the time during the trip. It is also often acknowledged that the VTT will vary with the level of comfort of the trip (lower VTT with higher comfort levels), because it influences the second component. We define comfort here as the degree to which the travel time can be spent productively/pleasantly. It not only includes aspects of crowding and stability but also the possibility to work, read a book, watch a movie and communicate during the trip. Technological innovations such as the introduction of laptops and smartphones have increased the level of comfort that is experienced during the trip. The literature on how the VTT varies with comfort, and by how much, is very limited (examples are: Wardman and Whelan, 2011; Kroes et al., 2014).

Some authors have already pointed at indications, derived especially from comparing VTT over time (Gunn, 2001, Börjesson et al., 2012, Kouwenhoven, 2014b), that the VTT decreases when the travel time can be used more productively and pleasantly. An important implication of this finding is that investments in comfort (such as installing WiFi in trains) will lead to a reduction of the VTT. In practice VTTs for project appraisal are updated (using new surveys) once every ten years or so. Therefore the appraisal VTTs will not drop immediately after an increase in comfort. But when a new value of travel time survey is carried out, the resulting VTTs will be lower than they would have been without the investments in travel comfort.

In most countries, transport time benefits are included in the cost-benefit analysis of transport projects, but increases in comfort are not. The current appraisal methodology therefore does not contain incentives to invest in (public transport) comfort; on the contrary, investing in comfort may in the long run lower the benefits of investments in travel time reduction. To incentivise projects that increase comfort for the travellers, the comfort benefits should be included in project appraisal and compared to  the reduction in the time benefits. The study reported in this paper tries to contribute to this goal by investigating how VTT varies with different aspects and levels of comfort.

In this paper we present the outcomes of a new analysis carried out on the stated preference (SP) data for passenger transport collected as part of the most recent Dutch national study on value of time and reliability (KiM, 2013, Significance et al., 2013, Kouwenhoven et al., 2014a). The questionnaires used at the time included questions about the use of travel time and the availability of mobile phones, laptops, I-Pods, etc. The answers to these questions were not used in the final models from which we derived the recommend VTTs and value of reliability (except for the use in the Hensher-equation for business trips).  In this paper we include variables based on these answers to the choice models that explain the choices the respondents made, to see how they impact on VTT.

The analysis is carried out for three modes (car, train and bus/tram/metro) and for three travel purposes ( commuting, business and other), so that we can see whether there the comfort-VTT function differs between modes and travel purposes. We use both the SP  interviews with members of an internet panel and SP interviews with travellers recruited during their trip e.g. at petrol stations, parkings, railway stations and bus stops.

On the basis of the responses in these surveys we define dummy-variables covering aspects such as:

  • Which activity was performed during the trip (working, studying, eating, communicating, reading, relaxing)?
  • Would the respondent have to do this work activity at the workplace and how productive was working during the trip relative to working at the workplace?
  • Which activity would the respondent have carried out  in case of a shorter trip duration (by a certain amount)?
  • Which activity would the respondent have reduced (or not carried out)  in case of a longer trip duration (by a certain amount)?

These dummy-variables then interact with the reference VTT, just as is the case in the official model for the socio-economic attributes of the persons or the different modes.

The estimated models are expanded using the Dutch national travel survey (OViN) of 2010 to derive nationally representative VTTs that can be compared to the values recommended for appraisal.

The estimation and application results then show whether these additional variables are significant additions to the model or not, as well as the sign and size of the effect: do new ICT devices and spending the travel  time more usefully lead to a lower VTT, and if so how much lower?

References

Börjesson, M., M. Fosgerau and S. Algers (2012) On the income elasticity of the value of travel time, Transportation Research A 46, 368-377.

Gunn, H.F. (2001) Spatial and temporal transferability of relationships between travel demand, trip cost and travel time. Transportation Research E, 37(2/3), 163-159.

Kennisinstituut voor Mobiliteitsbeleid KiM (2013) De maatschappelijke waarde van kortere en betrouwbaardere reistijden, Ministerie van Infrastructuur en Milieu, Den Haag. (tweede druk)

Kouwenhoven, M., G.C. de Jong, P. Koster, V.A.C. van den Berg, E.T. Verhoef, J.J. Bates and P. Warffemius (2014a) New values of time and reliability in passenger transport in The Netherlands, Research in Transportation Economics, 47, 37-49.

Kouwenhoven, M., G.C. de Jong, P. Koster, V.A.C. van den Berg, E.T. Verhoef and J.J. Bates (2014b) A fair comparison of the value of travel time in The Netherlands in 1997 and 2009/2011, hEART Conference 2014, Leeds.

Kroes, E.P., M. Kouwenhoven, L. Debrincat and N. Pauget (2014) On the value of crowding in public transport in Ile-de-France, Paper presented at Transport Research Arena 2014, Paris.

Significance, VU University, John Bates Services, TNO, NEA, TNS NIPO and PanelClix (2013) Values of time and reliability in passenger and freight transport in The Netherlands, Report for the Ministry of Infrastructure and the Environment, Significance, The Hague.

Wardman, M. and G. Whelan (2011) Twenty years of Rail Crowding Valuation Studies: Evidence and Lessons from British Experience, Transport Reviews, 31:3, 379-398.


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