IDEAS home Printed from https://ideas.repec.org/a/kap/transp/v47y2020i5d10.1007_s11116-019-10034-6.html
   My bibliography  Save this article

Short run fare elasticities for Bogotá’s BRT system: ridership responses to fare increases

Author

Listed:
  • Luis A. Guzman

    (Universidad de los Andes, Grupo de Sostenibilidad Urbana y Regional, SUR)

  • Santiago Gomez

    (University of Heidelberg)

  • Carlos Alberto Moncada

    (Universidad Nacional de Colombia)

Abstract

The fare policy of the BRT system in Bogotá, in order to cover its operating costs, has consisted of steadily fare increases, since its creation until 2012. To date, no study has been done to estimate the users’ reaction to these changes in the short-term. That is, there is no information about price-demand elasticities. This issue should be a key factor in deciding on price changes and evaluating the impact of these changes on ridership. In the case of Bogotá’s BRT (Transmilenio), estimating such elasticity is a need, but also a complex task: the travel demand is growing constantly and few fare changes happen at the same time throughout the whole system. To overcome this barrier, an econometric panel data model at station level was developed that takes advantage of highly disaggregated information on ridership for the Transmilenio system. The database provided information on entrances to the system’s stations between 2001 and 2012 at the daily level (phases 1 and 2). Monthly information on other factors that may influence ridership, like fuel prices, unemployment rates, population and traditional bus fares, were also included. After the introduction of a fare increase, the elasticity’s absolute value decreases from − 0.565 (1 week) to − 0.408 after a month. In addition, low-income users are more sensitive to these changes. We also test for differences between the effects during peak and off-peak hours. The results show higher values in the off-peak hours than in the peak hours. This should inform decision takers in Bogotá about the effect of fare changes on ridership responses and also on equity and accessibility.

Suggested Citation

  • Luis A. Guzman & Santiago Gomez & Carlos Alberto Moncada, 2020. "Short run fare elasticities for Bogotá’s BRT system: ridership responses to fare increases," Transportation, Springer, vol. 47(5), pages 2581-2599, October.
    • Handle: RePEc:kap:transp:v:47:y:2020:i:5:d:10.1007_s11116-019-10034-6
    DOI: 10.1007/s11116-019-10034-6
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s11116-019-10034-6
    File Function: Abstract
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s11116-019-10034-6?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Manel Daldoul & Sami Jarboui & Ahlem Dakhlaoui, 2016. "Public transport demand: dynamic panel model analysis," Transportation, Springer, vol. 43(3), pages 491-505, May.
    2. Jeffrey M Wooldridge, 2010. "Econometric Analysis of Cross Section and Panel Data," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262232588, December.
    3. Hensher, David A., 2008. "Assessing systematic sources of variation in public transport elasticities: Some comparative warnings," Transportation Research Part A: Policy and Practice, Elsevier, vol. 42(7), pages 1031-1042, August.
    4. Wang, Zi-jia & Li, Xiao-hong & Chen, Feng, 2015. "Impact evaluation of a mass transit fare change on demand and revenue utilizing smart card data," Transportation Research Part A: Policy and Practice, Elsevier, vol. 77(C), pages 213-224.
    5. Holmgren, Johan, 2007. "Meta-analysis of public transport demand," Transportation Research Part A: Policy and Practice, Elsevier, vol. 41(10), pages 1021-1035, December.
    6. Oded Cats & Yusak O. Susilo & Triin Reimal, 2017. "The prospects of fare-free public transport: evidence from Tallinn," Transportation, Springer, vol. 44(5), pages 1083-1104, September.
    7. Miller, Caroline & Savage, Ian, 2017. "Does the demand response to transit fare increases vary by income?," Transport Policy, Elsevier, vol. 55(C), pages 79-86.
    8. de Grange, Louis & González, Felipe & Muñoz, Juan Carlos & Troncoso, Rodrigo, 2013. "Aggregate estimation of the price elasticity of demand for public transport in integrated fare systems: The case of Transantiago," Transport Policy, Elsevier, vol. 29(C), pages 178-185.
    9. Paulley, Neil & Balcombe, Richard & Mackett, Roger & Titheridge, Helena & Preston, John & Wardman, Mark & Shires, Jeremy & White, Peter, 2006. "The demand for public transport: The effects of fares, quality of service, income and car ownership," Transport Policy, Elsevier, vol. 13(4), pages 295-306, July.
    10. Sharaby, Nir & Shiftan, Yoram, 2012. "The impact of fare integration on travel behavior and transit ridership," Transport Policy, Elsevier, vol. 21(C), pages 63-70.
    11. Cordera, Ruben & Canales, Cesar & dell’Olio, Luigi & Ibeas, Angel, 2015. "Public transport demand elasticities during the recessionary phases of economic cycles," Transport Policy, Elsevier, vol. 42(C), pages 173-179.
    12. Batarce, Marco & Galilea, Patricia, 2018. "Cost and fare estimation for the bus transit system of Santiago," Transport Policy, Elsevier, vol. 64(C), pages 92-101.
    13. Mark Wardman, 2014. "Price Elasticities of Surface Travel Demand A Meta-analysis of UK Evidence," Journal of Transport Economics and Policy, University of Bath, vol. 48(3), pages 367-384, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Guzman, Luis A. & Beltran, Carlos & Bonilla, Jorge & Gomez Cardona, Santiago, 2021. "BRT fare elasticities from smartcard data: Spatial and time-of-the-day differences," Transportation Research Part A: Policy and Practice, Elsevier, vol. 150(C), pages 335-348.
    2. Yang, Chao & Yu, Chengcheng & Dong, Wentao & Yuan, Quan, 2023. "Substitutes or complements? Examining effects of urban rail transit on bus ridership using longitudinal city-level data," Transportation Research Part A: Policy and Practice, Elsevier, vol. 174(C).
    3. Guzman, Luis A. & Hessel, Philipp, 2022. "The effects of public transport subsidies for lower-income users on public transport use: A quasi-experimental study," Transport Policy, Elsevier, vol. 126(C), pages 215-224.
    4. Chen, Ruoyu & Zhou, Jiangping, 2022. "Fare adjustment’s impacts on travel patterns and farebox revenue: An empirical study based on longitudinal smartcard data," Transportation Research Part A: Policy and Practice, Elsevier, vol. 164(C), pages 111-133.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Guzman, Luis A. & Beltran, Carlos & Bonilla, Jorge & Gomez Cardona, Santiago, 2021. "BRT fare elasticities from smartcard data: Spatial and time-of-the-day differences," Transportation Research Part A: Policy and Practice, Elsevier, vol. 150(C), pages 335-348.
    2. Zi-jia Wang & Feng Chen & Bo Wang & Jian-ling Huang, 2018. "Passengers’ response to transit fare change: an ex post appraisal using smart card data," Transportation, Springer, vol. 45(5), pages 1559-1578, September.
    3. Chen, Ruoyu & Zhou, Jiangping, 2022. "Fare adjustment’s impacts on travel patterns and farebox revenue: An empirical study based on longitudinal smartcard data," Transportation Research Part A: Policy and Practice, Elsevier, vol. 164(C), pages 111-133.
    4. Liu, Yan & Wang, Siqin & Xie, Bin, 2019. "Evaluating the effects of public transport fare policy change together with built and non-built environment features on ridership: The case in South East Queensland, Australia," Transport Policy, Elsevier, vol. 76(C), pages 78-89.
    5. Thommen, Christoph & Hintermann, Beat, 2023. "Price versus Commitment: Managing the demand for off-peak train tickets in a field experiment," Transportation Research Part A: Policy and Practice, Elsevier, vol. 174(C).
    6. Jiechao Zhang & Xuedong Yan & Meiwu An & Li Sun, 2017. "The Impact of Beijing Subway’s New Fare Policy on Riders’ Attitude, Travel Pattern and Demand," Sustainability, MDPI, vol. 9(5), pages 1-21, April.
    7. Miller, Caroline & Savage, Ian, 2017. "Does the demand response to transit fare increases vary by income?," Transport Policy, Elsevier, vol. 55(C), pages 79-86.
    8. Wang, Zi-jia & Li, Xiao-hong & Chen, Feng, 2015. "Impact evaluation of a mass transit fare change on demand and revenue utilizing smart card data," Transportation Research Part A: Policy and Practice, Elsevier, vol. 77(C), pages 213-224.
    9. Yaman, Firat & Offiaeli, Kingsley, 2022. "Is the price elasticity of demand asymmetric? Evidence from public transport demand," Journal of Economic Behavior & Organization, Elsevier, vol. 203(C), pages 318-335.
    10. Hintermann, Beat & Thommen, Christoph, 2022. "Price versus Commitment: Managing the Demand for Off-peak Train Tickets in a Field Experiment," Working papers 2022/05, Faculty of Business and Economics - University of Basel.
    11. Abe, Ryosuke & Kato, Hironori, 2017. "What led to the establishment of a rail-oriented city? Determinants of urban rail supply in Tokyo, Japan, 1950–2010," Transport Policy, Elsevier, vol. 58(C), pages 72-79.
    12. Chica-Olmo, Jorge & Gachs-Sánchez, Héctor & Lizarraga, Carmen, 2018. "Route effect on the perception of public transport services quality," Transport Policy, Elsevier, vol. 67(C), pages 40-48.
    13. Vigren, Andreas & Pyddoke, Roger, 2020. "The impact on bus ridership of passenger incentive contracts in public transport," Transportation Research Part A: Policy and Practice, Elsevier, vol. 135(C), pages 144-159.
    14. Redman, Lauren & Friman, Margareta & Gärling, Tommy & Hartig, Terry, 2013. "Quality attributes of public transport that attract car users: A research review," Transport Policy, Elsevier, vol. 25(C), pages 119-127.
    15. Krzysztof Grzelec & Aleksander Jagiełło, 2020. "The Effects of the Selective Enlargement of Fare-Free Public Transport," Sustainability, MDPI, vol. 12(16), pages 1-18, August.
    16. Hiroaki Nishiuchi & Yasuyuki Kobayashi & Tomoyuki Todoroki & Tomoya Kawasaki, 2018. "Impact analysis of reductions in tram services in rural areas in Japan using smart card data," Public Transport, Springer, vol. 10(2), pages 291-309, August.
    17. Wardman, Mark & Toner, Jeremy & Fearnley, Nils & Flügel, Stefan & Killi, Marit, 2018. "Review and meta-analysis of inter-modal cross-elasticity evidence," Transportation Research Part A: Policy and Practice, Elsevier, vol. 118(C), pages 662-681.
    18. Efthymiou, Dimitrios & Antoniou, Constantinos, 2017. "Understanding the effects of economic crisis on public transport users’ satisfaction and demand," Transport Policy, Elsevier, vol. 53(C), pages 89-97.
    19. Youzhi Zeng & Bin Ran & Ning Zhang & Xiaobao Yang, 2021. "Estimating the Price Elasticity of Train Travel Demand and Its Variation Rules and Application in Energy Used and CO 2 Emissions," Sustainability, MDPI, vol. 13(2), pages 1-19, January.
    20. Anupriya, & Graham, Daniel J. & Hörcher, Daniel & Anderson, Richard J. & Bansal, Prateek, 2020. "Quantifying the ex-post causal impact of differential pricing on commuter trip scheduling in Hong Kong," Transportation Research Part A: Policy and Practice, Elsevier, vol. 141(C), pages 16-34.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:transp:v:47:y:2020:i:5:d:10.1007_s11116-019-10034-6. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.