Alternative methods for quantifying commuting-related benefits of new transport infrastructure

A variety of methods have been developed which allow the estimation of benefits likely to arise from new transport infrastructure. In this paper, we concentrate on measuring commuting-related benefits. We compare and contrast two different approaches. The first relies on using data on commuting flows and the gravity model. The second approach uses the relationship between labour market accessibility and house prices. We use both methods to quantify these benefits, and discuss some of the potential reasons why they may give different estimates. We take as our case study a large infrastructure project in south-west Norway.

Measures of labour market accessibility: What can we learn from observed commuting patterns?

It is well known that measures of labour market accessibility explains spatial variation in housing prices even in markets with polycentric labour market structures. This paper examines whether data on observed commuting patterns can replace or supplement gravity-based measures representing the commuting potential at specific locations. We use data from a region in Western Norway,and we find that measures based on observed commuting flows and commuting time cannot replace a gravity-based measure of labour market accessibility. Based on, inter alia, the spatial Durbin estimator we find that measures of observed commuting flows increase the explanatory power of a hedonic house price model

The suitability of hedonic models for cost-benefit analysis: Evidence from commuting flows

Abstract In this paper we compare two estimates of benefits arising from the construction of two new bridges in the south west of Norway. Our first estimate comes from a hedonic property value model. Rather than follow an approach which is strictly theoretically correct, we adopt a simple one-step approach. In order to investigate whether this simplified approach gives a reasonable estimate, we compare it to an estimate derived from a travel demand model. We find that both methods give very similar estimates, suggesting that the simplistic hedonic approach was reasonable

Measures of labour market accessibility. What can we learn from observed commuting patterns?

It is well known that measures of labour market accessibility explains spatial variation in housing prices even in markets with polycentric labour market structures. This paper examines whether data on observed commuting patterns can replace or supplement gravity-based measures representing the commuting potential at specific locations. We use data from a region in Western Norway,and we find that measures based on observed commuting flows and commuting time cannot replace a gravity-based measure of labour market accessibility. Based on, inter alia, the spatial Durbin estimator we find that measures of observed commuting flows increase the explanatory power of a hedonic house price model

The suitability of hedonic models for cost-benefit analysis: evidence from commuting flows

We compare two estimates of benefits arising from the construction of new bridges in south-west Norway. One estimate comes from a hedonic property value model. Rather than follow an approach which is strictly theoretically correct, we adopt Rosen’s simple first-stage approach. To investigate and validate whether this simplified approach gives a reasonable estimate, we compare it to an estimate derived from a travel demand model. We find that a variant of an ex post hedonic house price model gives very similar estimates to the estimates from the travel demand model. This supports a hypothesis that the simplistic hedonic approach is reasonable

A bridge over troubled waters: valuing accessibility effects of a new bridge

Significant investment has been made to bridge the waters of the fjords which fragment the transportation network in western Norway. These topographical barriers inhibit spatial interaction and reduce labour market accessibility. In this paper, we propose a methodology for measuring and valuing some of the accessibility benefits arising from this type of new infrastructure. We then apply this to a large transport infrastructure project which recently took place in south-west Norway. A key innovation of our paper is that we model the effect of pecuniary costs on labour market accessibility and show that failure to account for these can lead to an overestimation of the accessibility benefits. This is an important finding given that user charges are frequently applied to finance infrastructure expansions