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Value of time: Speeding behavior and gasoline prices

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  • Wolff, Hendrik

Abstract

‘Value of Time’ (VOT) is a key parameter in economics and policy. This paper presents an alternative method to estimate VOT by analyzing an hourly dataset on drivers speeding behavior as a function of the gasoline price. Our identification strategy is novel as it is based on the intensive margin. In comparison, previous studies reveal VOT on the extensive margin, but choice alternatives have multiple attributes thereby potentially confounding estimates. Consistent with the range of the prior literature, we find a VOT of about 50% of the wage rate and analyze sources of bias from accidents and traffic tickets. These bias functions suggest that previous stated preference VOT estimates are likely downward whereas previous revealed preference estimates are likely upward biased.

Suggested Citation

  • Wolff, Hendrik, 2014. "Value of time: Speeding behavior and gasoline prices," Journal of Environmental Economics and Management, Elsevier, vol. 67(1), pages 71-88.
  • Handle: RePEc:eee:jeeman:v:67:y:2014:i:1:p:71-88
    DOI: 10.1016/j.jeem.2013.11.002
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Fetene, Gebeyehu M. & Hirte, Georg & Kaplan, Sigal & Prato, Carlo G. & Tscharaktschiew, Stefan, 2016. "The economics of workplace charging," Transportation Research Part B: Methodological, Elsevier, vol. 88(C), pages 93-118.
    2. Egan, Kevin J. & Corrigan, Jay R. & Dwyer, Daryl F., 2015. "Three reasons to use annual payments in contingent valuation surveys: Convergent validity, discount rates, and mental accounting," Journal of Environmental Economics and Management, Elsevier, vol. 72(C), pages 123-136.
    3. van Benthem, Arthur, 2015. "What is the optimal speed limit on freeways?," Journal of Public Economics, Elsevier, vol. 124(C), pages 44-62.
    4. repec:eee:energy:v:150:y:2018:i:c:p:276-288 is not listed on IDEAS
    5. Tscharaktschiew, Stefan, 2016. "The private (unnoticed) welfare cost of highway speeding behavior from time saving misperceptions," Economics of Transportation, Elsevier, vol. 7, pages 24-37.
    6. Srikant Devaraj & Pankaj C Patel, 2016. "Gas Prices and Red light Violations in Chicago," Economics Bulletin, AccessEcon, vol. 36(3), pages 1844-1853.

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