Unit income elasticity of the value of travel time savings
The paper presents an analysis of the income elasticity of the value of travel time savings (VTTS). It expands on previous micro-econometric estimates of the VTTS on binary choice experimental data by accounting for income taxes, for the dependence of trip length on income and for the stochastic distribution of the VTTS using semiparametric methods. Previous empirical estimates of the elasticity are around 0.6 while in practice i.a. Denmark and the UK (until 2004) apply a unit income elasticity for forecasting the future VTTS in economic evaluations of transport projects. This discrepancy may be resolved as shown in the paper.
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- DeSerpa, A C, 1971. "A Theory of the Economics of Time," Economic Journal, Royal Economic Society, vol. 81(324), pages 828-846, December.
- Mogens Fosgerau, 2004.
"Investigating the distribution of the value of travel time savings,"
- Fosgerau, Mogens, 2006. "Investigating the distribution of the value of travel time savings," Transportation Research Part B: Methodological, Elsevier, vol. 40(8), pages 688-707, September.
- Mogens Fosgerau, 2004. "Investigating the distribution of the value of travel time savings," Urban/Regional 0410005, EconWPA, revised 25 Nov 2004.
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