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The value of time and external benefits in bicycle appraisal

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  • Börjesson, Maria
  • Eliasson, Jonas

Abstract

We estimate the value of time savings, different cycling environments and additional benefits in cost–benefit analysis of cycling investments. Cyclists’ value of travel time savings turns out to be high, considerably higher than the value of time savings on alternative modes. Cyclists also value other improvements highly, such as separated bicycle lanes. As to additional benefits of cycling improvements in the form of health and reduced car traffic, our results do not support the notion that these will be a significant part in a cost–benefit analysis. Bicyclists seem to take health largely into account when making their travel choices, implying that it would be double-counting to add total health benefits to the analysis once the consumer surplus has been correctly calculated. As to reductions in car traffic, our results indicate that the cross-elasticity between car and cycle is low, and hence benefits from traffic reductions will be small. However, the valuations of improved cycling speeds and comfort are so high that it seems likely that improvements for cyclists are cost-effective compared to many other types of investments, without having to invoke second-order, indirect effects. In other words, our results suggest that bicycle should be viewed as a competitive mode of travel and not primarily as a means to achieve improved health or reduced car traffic.

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Bibliographic Info

Article provided by Elsevier in its journal Transportation Research Part A: Policy and Practice.

Volume (Year): 46 (2012)
Issue (Month): 4 ()
Pages: 673-683

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Handle: RePEc:eee:transa:v:46:y:2012:i:4:p:673-683

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Related research

Keywords: Value of time; Bicycle; Cost–benefit analysis; Appraisal; Additional benefits; Health effects;

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References

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  1. Börjesson, Maria & Fosgerau, Mogens & Algers, Staffan, 2012. "On the income elasticity of the value of travel time," Transportation Research Part A: Policy and Practice, Elsevier, vol. 46(2), pages 368-377.
  2. Sergio Jara-Díaz, 2003. "On the goods-activities technical relations in the time allocation theory," Transportation, Springer, vol. 30(3), pages 245-260, August.
  3. Mogens Fosgerau, 2004. "Investigating the distribution of the value of travel time savings," Urban/Regional 0411006, EconWPA.
  4. Börjesson, Maria & Fosgerau, Mogens & Algers, Staffan, 2012. "Catching the tail: Empirical identification of the distribution of the value of travel time," Transportation Research Part A: Policy and Practice, Elsevier, vol. 46(2), pages 378-391.
  5. O'Donoghue, Ted & Rabin, Matthew, 2006. "Optimal sin taxes," Journal of Public Economics, Elsevier, vol. 90(10-11), pages 1825-1849, November.
  6. Rietveld, Piet & Daniel, Vanessa, 2004. "Determinants of bicycle use: do municipal policies matter?," Transportation Research Part A: Policy and Practice, Elsevier, vol. 38(7), pages 531-550, August.
  7. Abrantes, Pedro A.L. & Wardman, Mark R., 2011. "Meta-analysis of UK values of travel time: An update," Transportation Research Part A: Policy and Practice, Elsevier, vol. 45(1), pages 1-17, January.
  8. Ted O'Donoghue & Matthew Rabin, 2003. "Studying Optimal Paternalism, Illustrated by a Model of Sin Taxes," American Economic Review, American Economic Association, vol. 93(2), pages 186-191, May.
  9. Sergio R. Jara-Diaz & Cristián A. Guevara, 2003. "Behind the Subjective Value of Travel Time Savings," Journal of Transport Economics and Policy, London School of Economics and University of Bath, vol. 37(1), pages 29-46, January.
  10. Wardman, Mark & Tight, Miles & Page, Matthew, 2007. "Factors influencing the propensity to cycle to work," Transportation Research Part A: Policy and Practice, Elsevier, vol. 41(4), pages 339-350, May.
  11. Sælensminde, Kjartan, 2004. "Cost-benefit analyses of walking and cycling track networks taking into account insecurity, health effects and external costs of motorized traffic," Transportation Research Part A: Policy and Practice, Elsevier, vol. 38(8), pages 593-606, October.
  12. Börjesson, Maria & Eliasson, Jonas, 2012. "Experiences from the Swedish Value of Time study," Working papers in Transport Economics 2012:8, CTS - Centre for Transport Studies Stockholm (KTH and VTI).
  13. Jonas Eliasson & Mattias Lundberg, 2011. "Do Cost--Benefit Analyses Influence Transport Investment Decisions? Experiences from the Swedish Transport Investment Plan 2010--21," Transport Reviews, Taylor and Francis Journals, vol. 32(1), pages 29-48, April.
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  1. The value of time and external benefits in bicycle appraisal
    by CostBenefit in Environmental Valuation & Cost-Benefit News on 2012-01-01 15:45:00

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