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Value of Travel Time Savings for University Students and Preference Heterogeneity

Author

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  • Francisco Javier Amador Morera

    (Universidad de La Laguna)

  • Rosa Marina González Marrero

    (Universidad de La Laguna)

Abstract

This paper examines the sensitivity of value of travel time savings (VTTS) to assumptions on individual preferences in a random utility discrete choice framework. Preferences heterogeneity is incorporated by introducing random parameters and by interacting characteristics of travel modes with characteristics of the individual. The data set is a revealed preference survey on student travel mode choice. The results indicate that there is a systematic influence of gender on VTTS and additional heterogeneity is explained by unobserved characteristics. The evidence also suggests model specifications that impose preferences homogeneity tend to produce lower estimates of VTTS compared with more flexible structures that allow random variation of parameters over individuals. However, the degree of underestimation seems to be context dependent..

Suggested Citation

  • Francisco Javier Amador Morera & Rosa Marina González Marrero, 2005. "Value of Travel Time Savings for University Students and Preference Heterogeneity," Hacienda Pública Española / Review of Public Economics, IEF, vol. 174(3), pages 25-41, September.
    • Handle: RePEc:hpe:journl:y:2005:v:174:i:3:p:25-41
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    References listed on IDEAS

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    More about this item

    Keywords

    Random utility discrete choice models; preference heterogeneity; subjective value of travel time; random parameter logit.;
    All these keywords.

    JEL classification:

    • R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise
    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis

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