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The Relevance of Heterogeneity in a Congested Route Network with Tolls: An Analysis of Two Experiments Using Actual Waiting Times and Monetized Time Costs

  • Hartman, John Lawrence
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    Heterogeneity is important in some settings. One such instance involves congested networks with tolls, since people trade time for money at different rates. This paper reports results from two experiments that examine these issues. In both experiments, subjects choose between traveling on an indirect route that does not congest and a direct toll route that congests as more subjects travel on it. In the first experiment, values of time are assigned to subjects. Subjects generally sort themselves with high value-of-time subjects choosing the toll route. I also find that as the cost of deviating from the equilibrium prediction increases, subjects are more likely to make choices consistent with equilibrium. In other words, coordination problems diminish as value-of-time heterogeneity increases. The second experiment simulates a boring commute in which subjects must wait after the experimental rounds are finished. Subjects can give up money for reduced waiting time in this experiment by traveling on the toll route. In this experiment, some subjects travel the toll route frequently, giving up some of their payout in order to reduce their waiting time after the experiment. These choices are likely based on individuals’ values of time, since aggregate behavior differs by session. There is also evidence that subjects with time constraints travel the toll route more often than other subjects.

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    Paper provided by Department of Economics, UC Santa Barbara in its series University of California at Santa Barbara, Economics Working Paper Series with number qt22b46341.

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    Date of creation: 01 Nov 2007
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    Handle: RePEc:cdl:ucsbec:qt22b46341
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    1. Ellingsen, Tore & Johannesson, Magnus, 2006. "Time is not money," SSE/EFI Working Paper Series in Economics and Finance 663, Stockholm School of Economics.
    2. Brownstone, David & Small, Kenneth A., 2003. "Valuing Time and Reliability: Assessing the Evidence from Road Pricing Demonstrations," University of California Transportation Center, Working Papers qt95z0p35k, University of California Transportation Center.
    3. Hartman, John Lawrence, 2007. "A Route Choice Experiment With an Efficient Toll," University of California at Santa Barbara, Economics Working Paper Series qt4s1116mv, Department of Economics, UC Santa Barbara.
    4. Gabuthy Yannick & Neveu Matthieu & Denant-Boemont Laurent, 2006. "The Coordination Problem in a Structural Model of Peak-Period Congestion: An Experimental Study," Review of Network Economics, De Gruyter, vol. 5(2), pages 1-26, June.
    5. Dynarski, Susan, 2004. "Who Benefits from the Education Saving Incentive? Income, Educational Expectations and the Value of the 529 and Coverdell," Working Paper Series rwp04-019, Harvard University, John F. Kennedy School of Government.
    6. Thorsten Chmura & Thomas Pitz, 2004. "An Extended Reinforcement Algorithm for Estimation of Human Behaviour in Congestion Games," Bonn Econ Discussion Papers bgse24_2004, University of Bonn, Germany.
    7. Taubman, Paul, 1989. "Role of Parental Income in Educational Attainment," American Economic Review, American Economic Association, vol. 79(2), pages 57-61, May.
    8. Urs Fischbacher, 2007. "z-Tree: Zurich toolbox for ready-made economic experiments," Experimental Economics, Springer, vol. 10(2), pages 171-178, June.
    9. Deacon, Robert T & Sonstelie, Jon, 1985. "Rationing by Waiting and the Value of Time: Results from a Natural Experiment," Journal of Political Economy, University of Chicago Press, vol. 93(4), pages 627-47, August.
    10. B. F. Kiker & C. M. Condon, 1981. "The Influence of Socioeconomic Background on the Earnings of Young Men," Journal of Human Resources, University of Wisconsin Press, vol. 16(1), pages 94-105.
    11. Selten, R. & Chmura, T. & Pitz, T. & Kube, S. & Schreckenberg, M., 2007. "Commuters route choice behaviour," Games and Economic Behavior, Elsevier, vol. 58(2), pages 394-406, February.
    12. Thorsten Chmura & Thomas Pitz, 2004. "Minority Game - Experiments and Simulations of Traffic Scenarios," Bonn Econ Discussion Papers bgse23_2004, University of Bonn, Germany.
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