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VTT or VTTS: a note on terminology for value of travel time work

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  • Andrew Daly

    (University of Leeds)

  • Stephane Hess

    (University of Leeds)

Abstract

The value of travel time (VTT) can be said to be the most important number in transport economics, and its estimation has been the topic of extensive academic and applied work. Numerous papers use the term “value of travel time savings”, or VTTS. The addition of the word “savings” has not arisen suddenly but goes back to the 1970s, and has also been used in the titles of national studies. The addition of ‘savings’ is in our view incorrect, misleading and unhelpful. Unlike money, time cannot be stored or borrowed—there is no piggy bank for spare minutes. In addition, the modelling approaches used for many of the more advanced VTT studies in fact produce valuations that are ‘bracketed’ between gains and losses in time, and an average between these gains and losses, typically the geometric mean, is then used as the VTT. It is then clear that the value obtained from this averaging cannot be described as the value of time savings (or reductions), as it includes the higher value of losses (i.e. increases) as well. To exemplify the magnitude of our theoretical points, we show how for the 2015 UK VTT study, using the bracketed value for commuters and labelling it as a VTTS implies an overestimation by a factor of more than 2.

Suggested Citation

  • Andrew Daly & Stephane Hess, 2020. "VTT or VTTS: a note on terminology for value of travel time work," Transportation, Springer, vol. 47(3), pages 1359-1364, June.
    • Handle: RePEc:kap:transp:v:47:y:2020:i:3:d:10.1007_s11116-018-9966-4
    DOI: 10.1007/s11116-018-9966-4
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    References listed on IDEAS

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    4. Hess, Stephane & Daly, Andrew & Dekker, Thijs & Cabral, Manuel Ojeda & Batley, Richard, 2017. "A framework for capturing heterogeneity, heteroskedasticity, non-linearity, reference dependence and design artefacts in value of time research," Transportation Research Part B: Methodological, Elsevier, vol. 96(C), pages 126-149.
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    Cited by:

    1. Hensher, David A. & Beck, Matthew J. & Balbontin, Camila, 2021. "What does the quantum of working from home do to the value of commuting time used in transport appraisal?," Transportation Research Part A: Policy and Practice, Elsevier, vol. 153(C), pages 35-51.
    2. Tjiong, Jeff & Dekker, Thijs & Hess, Stephane & Ojeda Cabral, Manuel, 2022. "The selection of income measures in value of travel time models and their implications for the VTT, its cross-sectional income elasticity and transport appraisal," Research in Transportation Economics, Elsevier, vol. 94(C).

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