Inter-temporal variations in the value of time

INTRODUCTION The objective of the research reported here is to examine how the value of time varies over time. A key factor in inter-temporal variations in the value of time is expected to be the impact of income growth, although changes in other socio-economic, demographic, attitudinal, employment and travel characteristics could also lead to variations in the value of time over time. The most widely held convention relating to the adjustment of recommended values of time over time is that they should be linked proportionately to growth in some measure of income. No consideration is given to possible changes in the value of time for other reasons. Even disregarding the latter issue, there is no reason from a theoretical standpoint why the income elasticity for private travel should be unity since it is a matter of personal preference how an individual or household allocates additional income to time savings. In contrast, the case for a close link between the value of time and income is much stronger for business travel. Official recommendations in Britain, as elsewhere, increase the value of non-work travel time over time in line with growth in income. DETR’s Transport Economics Note specifies that both work and non-work time values should be increased in line with real GDP per head. Beesley (1971) pointed out various sources of variation in the value of time over time and, on the basis of the uncertainty as to even the direction in which the values might vary, he argued for in favour of a zero trend value. The first British national value of time study (MVA et al., 1987) claimed that a constant real value of time was on theoretical grounds “equally logical and defensible” as the convention of linking the value of time to income growth. However, it was recognised that there did seem to have been an increase in the value of time over time. It was concluded that, “We do not feel able, therefore, in the absence of any specific work on this topic within our programme, and given the existence of plausible arguments in contrary directions, to come to any firm conclusions. The matter must remain on the agenda for further investigation”. A large amount of recent evidence, which we shall cover, is being taken to indicate that the income elasticity for the value of time spent in private travel is far less than unity. It is important that such a challenge to the widely used convention is tested against the widest body of evidence possible before any conclusions are drawn, particularly given the implications of amended recommendations for practical project evaluations. The aim of this paper is to review the existing evidence relevant to inter-temporal variations in the value of time and to present some fresh empirical evidence. The approach adopted here is threefold. Firstly, we examine the cross-sectional variations in the value of time with income apparent from a number of empirical studies, both British and from other countries, and we develop a model to explain cross-sectional income elasticities across British studies. Secondly, the opportunity exists of analysing two data sets obtained from the same SP design conducted in the same area but at different points in time. Finally, variations in values of time over time are analysed by means of ‘meta-analysis’ of a large data set of British empirical evidence. The structure of this report is as follows. Section 2 contains a discussion of various background issues relating to theoretical maters, methodology and previous findings. Section 3 reports analysis of cross-sectional variations in values of time with income whilst section 4 reports on joint analysis of two data sets collected in the first and second national value of time studies commissioned by the Department of Transport. Section 5 reports the findings of our meta-analysis of a large body of British evidence on the value of time. A discussion of the various findings is provided in section 6 and concluding remarks are provided in section 7. The final stage of the study will draw together this evidence to form recommendations concerning the value of time over time

An Analysis of Motorists’ Route Choice Using Stated Preference Techniques

This paper presents some results of an analysis of motorists' route choice based on stated preference responses. This is done for both an inter-urban and urban route choice context. The nature of the study is exploratory; the analysis being based upon a pilot survey of some 79 motorists undertaken in March/April 1984. The quality and nature of the responses are assessed in terms of a 'rationality' test and also through a consideration of lexicographical forms of decision making. The formal quantitative analysis examines the ranked preferences of motorists by means of an ordered multinomial logit model. Detailed results are presented for various formulations of the representative utility function to assess the influence of various relevant variables upon mute choice and to identify the best explanation of motorists' stated route preferences in both route choice contexts. Values of time are derived for a variety of rodel specifications as part of this consideration of the usefullness of the ranking approach to an analysis of motorists route choice

Route Choice and the Value of Motorists’ Travel Time: Theoretical and Methodological Issues

In June 1985, a survey of motorists makng urban journeys within Tyne and Wear was undertaken as part of the Department of Transport's research project into the value of time. This paper considers the theoretical and methodological issues involved in estimating the value that motorists' place upon travel time savings from their actual route choices and their responses to a simulated route choice experiment. The reasons for undertaking this survey and for choosing this particular location are discussed. The experimental design and the modelling technique used in the stated preference analysis are examined and the problems which face both a revealed preference and a stated preference investigation of motorists' route choices are considered. One of the aims of the study is to consider variations in the value of time according to socio-economic factors and journey characteristics. The theoretical sources of variations in the value of time are discussed as is the modelling approach which was adopted to analyse these potential variations. The empirical findings from the actual survey of motorists making urban journeys is the subject of a subsequent working paper

The Distribution of Individual Values of Time: An Empirical Study Using Stated Preference Data

This paper reports the findings of further work undertaken on the Stated Preference (SP) data collected as part of the Department of Transport's Value of Time Project. The latter study estimated values of time in a variety of different circumstances and for a number of modes of travel and also examined how the value of time varied according to socio-economic factors. Although values of time were allowed to vary across individuals by segmenting the data according to socio-economic factors, the SP data permits the estimation of values of time at the individual level whereupon a distribution of individual values can be obtained. The Department of Transport expressed some interest in what information could be provided by the SP data about the distribution of values of in-vehicle time across individuals. Individual values of in-vehicle time have been estimated for each of the five SP experiments which had previously been conducted to obtain a distribution for each survey context and also pooled across surveys to derive a population distribution. The problems of estimating values at the individual level with the SP data available are considered and the findings are compared with the average values previously derived in the Value of Time Study. How these individual values of time vary with socio-economic factors is also considered

Factors influencing the propensity to cycle to work

This paper describes the development of a mode choice model for the journey to work with special emphasis on the propensity to cycle. The model combines revealed preference (RP) and stated preference (SP) data to form a very large and comprehensive model. RP data from the National Travel Survey was combined with a specially commissioned RP survey. A number of SP surveys were also undertaken to examine the effects of different types of en-route and trip end cycle facilities and financial measures to encourage cycling. The development of the model is described in detail. The model was used to forecast trends in urban commuting shares over time and to predict the impacts of different measures to encourage cycling. Of the en-route cycle facilities, a completely segregated cycleway was forecast to have the greatest impact, but even the unfeasible scenario of universal provision of such facilities would only result in a 55% increase in cycling and a slight reduction in car commuting. Payments for cycling to work were found to be highly effective with a £2 daily payment almost doubling the level of cycling. The most effective policy would combine improvements in en-route facilities, a daily payment to cycle to work and comprehensive trip end facilities and this would also have a significant impact on car commuting

The Effect of Rail Journey Time Improvements: Some Results and Lessons of British Experience Relevant to High Speed Rail Forecasting.

This paper discusses the British experience of forecasting the effect of journey time reductions on the demand for rail travel. Its purpose is to discuss results and methodologies from the British context which may be appropriate to other contexts, and particularly to forecasting the demand for new high speed rail services. Two areas of research are selected for discussion: aggregate econometric models of rail demand and Stated Preference choice models. It is concluded that the results derived from one context may not be as transferable as one might wish to some other situation and that it is important to obtain a better understanding of the factors influencing journey time elasticities. Both of the demand analysis methodologies discussed could contribute to an improved understanding whilst an attraction of the Stated Preference approach is that it lessens the need to transfer results from one context to another

Public transport values of time

OBJECTIVES The objectives of this aspect of the study are to provide recommended valuations of: • Public transport in-vehicle time (IVT) • Walk time • Wait time/headway with appropriate modifiers according to key factors such as: • Mode user type • The mode to which the value relates • Journey distance and inter urban or urban context • Journey purpose A recommended procedure for updating values of time over time is also required. Although this issue is touched upon in this paper, a more detailed analysis is the subject of a separate aspect of the study and is reported in Working Paper 566. The Accent and Hague Consulting Group study did not cover public transport. Nor is this study conducting fresh empirical research. We must therefore base our recommendations on other existing studies. Fortunately, there is a wealth of British evidence on the value of time. Section 2 provides some background to the valuations of time for public transport users and the valuation of attributes which are important aspects of public transport use. Section 3 details the additional data that has been collected to enhance our previous data sets upon which we have conducted meta-analysis (Wardman, 2001) whilst Section 4 presents tabulations of the money values of time, and the time values of walk, wait and headway, disaggregated as far as is sensible by purpose, mode and whether the journey is urban or inter-urban. Section 5 describes the principal approach that we have adopted to explain the values of time obtained from the many different studies that are available to us. Section 6 is concerned with a regression model estimated to the money values for all travellers. From this model are extracted the money values of time and the IVT equivalent values of walk time, wait time and headway for public transport users. The IVT values can be expressed as absolute values or as relative to car users’ values. The latter is useful where recommended public transport values are derived as a series of modifiers to car users’ values. As a check of the IVT values of walk, wait and headway implied by the model estimated to money values, we report in section 7 a model estimated solely to the IVT values of walk, wait and headway. Concluding remarks are provided in section 8. Recommendations and comparisons with other aspects of the study are a feature of Working Paper 567

Disaggregate Urban Mode Choice Models: A Review of British Evidence with Special Reference to Cross Elasticities.

As part of an EPSRC funded research project (GRK52522) entitled 'National Multi-Modal Travel Forecasts', a review of the demand forecasting literature has been conducted. The principal aim of this project is to develop a set of national and regional travel demand forecasts by land-based modes. Such models will contain a set of own and cross-elasticities which can be used in strategic demand forecasting. A review of the literature, alongside fresh empirical work, makes an important contribution to this. A review of aggregate models is contained in Clark (1996). Such models are based on collective behaviour such as market shares or travel volumes. In contrast, disaggregate models make the individual decision maker the unit of observation. Within this project, Wardman (1997a) has provided a review of disaggregate mode choice models developed in the inter-urban context in Great Britain whilst Whelan (1997) has provided a review of car ownership modelling and forecasting. This paper provides a review of comparatively recent research involving disaggregate mode choice models which have been developed in Great Britain in the urban context. The emphasis of this research is on cross elasticities for three reasons: Mode choice models are well suited to the estimation of cross-elasticities; The own elasticities provided by disaggregate mode choice models are underestimates since they do not account for behavioural responses other than mode switching (Oum et al., 1992); There has long been a view (Dodgson, 1991) that there is insufficient evidence regarding the degree of interaction between modes and this view remains (Acutt and Dodgson, 1995; Wardman et al., 1997) In contrast, aggregate models are well suited to the analysis of own elasticities since they take into account changes in the total number of trips yet they are generally limited in the extent to which they examine inter-modal competition and hence generally provide little evidence on cross-elasticities. In this paper, we have drawn upon studies made available to us as part of a review study conducted for the Department of Transport into the value of time (Wardman, 1997b). Much of this evidence was provided on the basis that the identity of the studies remains anonymous. We have therefore provided the key parameter estimates from 34 studies without revealing the identity of thes

Disaggregate Inter-Urban Mode Choice Models: A review of British Evidence with special Reference to Cross Elasticities.

The research reported in this paper forms part of EPSRC project GRK52522 entitled 'National Multi-Modal Travel Forecasts'. The principal aim of this project is to develop a set of national and regional travel demand forecasts by land-based modes. These demand models for car, bus and rail will be based on a hierarchy of techniques and hence there are several strands to this research. One aspect of the research involves the review of aggregate models, based on collective travel behaviour, and the evidence that they yield on own and cross elasticities. Whilst such models provide a wealth of information on own elasticities, and are particularly well suited to the analysis of the effects of exogenous factors on travel demand, they tend to make little allowance for competitive effects and hence provide little evidence regarding cross-elasticities. Furthermore, their nature is such that there can be only limited segmentation of the elasticities by relevant travel and socio-economic factors. Another aspect of the study is reviewing the evidence that is provided by disaggregate models where, in contrast to the aggregate models, the unit of observation is the individual decision maker. Since such models examine competition between modes, they are particularly useful in providing evidence on cross-elasticities. A further aspect of the work will be the actual estimation of relevant demand models and elasticities for a range of circumstances and by a variety of means. The final stage prior to application of the models is to draw all the evidence together in a consistent manner, drawing upon the strengths of different approaches and the various insights that they provide

Route Choice and the Value of Motorists’ Travel Time: Theoretical and Methodological Issues

In June 1985, a survey of motorists makng urban journeys within Tyne and Wear was undertaken as part of the Department of Transport's research project into the value of time. This paper considers the theoretical and methodological issues involved in estimating the value that motorists' place upon travel time savings from their actual route choices and their responses to a simulated route choice experiment. The reasons for undertaking this survey and for choosing this particular location are discussed. The experimental design and the modelling technique used in the stated preference analysis are examined and the problems which face both a revealed preference and a stated preference investigation of motorists' route choices are considered. One of the aims of the study is to consider variations in the value of time according to socio-economic factors and journey characteristics. The theoretical sources of variations in the value of time are discussed as is the modelling approach which was adopted to analyse these potential variations. The empirical findings from the actual survey of motorists making urban journeys is the subject of a subsequent working paper