How People Spend to Save Time

Estimates of value of travel time savings (VTTS) are important elements in benefit-cost analyses of transportation projects. Additionally, differences in VTTS among transportation modes and among the residential collection, line haul, and distribution portions of the commute provide information to planners and others on the likely success of diverting trips from single-occupant vehicles to alternatives. One criticism of current measurements of VTTS is the reporting of average values for entire populations or very large subgroups of travelers. According to a current research needs statement from Transportation Research Board (TRB) Committee ABE20 (Transportation Economics), while the use of average values of VTTS is straightforward and relatively simple, it assumes a normal distribution when the true distribution is likely skewed. If the true VTTS distribution is skewed, the traffic redistribution and revenue outcomes of pricing measures will be incorrectly estimated. The research needs statement also notes that there is evidence that individual VTTS varies considerably for the same individual on different occasions. This can be seen in the use patterns of optional toll facilities where the same people make different route choices on different days. In addition to demographics, individual VTTS can depend on trip purpose, amount of time saved per trip, who is paying (the traveler or the employer), and the possibility of engaging in other productive or enjoyable activities while traveling. Clearly, there are quality of life issues related to individual measurements of VTTS. There is a need to improve the theory leading to the correct measures of VTTS and improve its estimation. In challenging the prevailing way VTTS is measured, and in proposing a new way, it is critical to understand the theoretical foundations of current VTTS measurements. Improved measures of VTTS will only be achieved by improving the underlying theory. As such, part of this work will necessarily address the theoretical issues identified above. This proposed work draws on two important results from urban economics. It has been shown both theoretically and empirically that an increase in distance between the residence of CBD-employed workers and the CBD reduces housing expenditure by exactly the amount that it increases commuting cost (DeSalvo, 1977a; Mills and Hamilton, 1994, pp. 109-112, 132). Similarly, it has been shown both theoretically and empirically that the incomes of suburban workers fall with distance from the CBD by an amount exactly equal to the saving on commuting cost due to suburban vs. CBD employment (DeSalvo, 1977b; Mills and Hamilton, 1994, pp. 117-121, 134). These results illustrate the trade-offs that individuals must make in deciding where to live, where to work, and how to travel between home and work. We propose to estimate VTTS based on this economic theory using actual market data (observed data and revealed preference) rather than the typical approach using stated preference survey data, which we believe will lead to more accurate results. By better understanding the market and the distribution of VTTS, decision-makers will be able to more accurately estimate traffic and revenue impacts of various transportation projects, including managed lanes. This research would be beneficial for areas with existing or planned managed lane projects located around the country and, in particular, Florida (with data collection occurring in South Florida). Estimates of value of travel time savings (VTTS) are important elements in benefit-cost analyses of transportation projects. Additionally, differences in VTTS among transportation modes and among the residential collection, line haul, and distribution portions of the commute provide information to planners and others on the likely success of diverting trips from single-occupant vehicles to alternatives. One criticism of current measurements of VTTS is the reporting of average values for entire populations or very large subgroups of travelers. According to a current research needs statement from Transportation Research Board (TRB) Committee ABE20 (Transportation Economics), while the use of average values of VTTS is straightforward and relatively simple, it assumes a normal distribution when the true distribution is likely skewed. If the true VTTS distribution is skewed, the traffic redistribution and revenue outcomes of pricing measures will be incorrectly estimated. The research needs statement also notes that there is evidence that individual VTTS varies considerably for the same individual on different occasions. This can be seen in the use patterns of optional toll facilities where the same people make different route choices on different days. In addition to demographics, individual VTTS can depend on trip purpose, amount of time saved per trip, who is paying (the traveler or the employer), and the possibility of engaging in other productive or enjoyable activities while traveling. Clearly, there are quality of life issues related to individual measurements of VTTS. There is a need to improve the theory leading to the correct measures of VTTS and improve its estimation. In challenging the prevailing way VTTS is measured, and in proposing a new way, it is critical to understand the theoretical foundations of current VTTS measurements. Improved measures of VTTS will only be achieved by improving the underlying theory. As such, part of this work will necessarily address the theoretical issues identified above. This proposed work draws on two important results from urban economics. It has been shown both theoretically and empirically that an increase in distance between the residence of CBD-employed workers and the CBD reduces housing expenditure by exactly the amount that it increases commuting cost (DeSalvo, 1977a; Mills and Hamilton, 1994, pp. 109-112, 132). Similarly, it has been shown both theoretically and empirically that the incomes of suburban workers fall with distance from the CBD by an amount exactly equal to the saving on commuting cost due to suburban vs. CBD employment (DeSalvo, 1977b; Mills and Hamilton, 1994, pp. 117-121, 134). These results illustrate the trade-offs that individuals must make in deciding where to live, where to work, and how to travel between home and work. We propose to estimate VTTS based on this economic theory using actual market data (observed data and revealed preference) rather than the typical approach using stated preference survey data, which we believe will lead to more accurate results. By better understanding the market and the distribution of VTTS, decision-makers will be able to more accurately estimate traffic and revenue impacts of various transportation projects, including managed lanes. This research would be beneficial for areas with existing or planned managed lane projects located around the country and, in particular, Florida (with data collection occurring in South Florida).

    Language

    • English

    Project

    • Status: Active
    • Sponsor Organizations:

      Florida Department of Transportation

      605 Suwannee Street
      Tallahassee, FL  United States  32399-0450
    • Project Managers:

      Datz, Amy

    • Performing Organizations:

      University of South Florida, Tampa

      Center for Urban Transportation Research
      3650 Spectrum Boulevard
      Tampa, FL  United States  33612-9446
    • Principal Investigators:

      Perk, Victoria

    • Start Date: 20100216
    • Expected Completion Date: 0
    • Actual Completion Date: 0
    • Source Data: RiP Project 25169

    Subject/Index Terms

    Filing Info

    • Accession Number: 01461702
    • Record Type: Research project
    • Source Agency: University of South Florida, Tampa
    • Files: UTC, RiP, STATEDOT
    • Created Date: Jan 3 2013 1:50PM