USING VALUES OF TRAVEL TIME SAVINGS FOR TOLL ROADS: AVOIDING SOME COMMON ERRORS

In the estimation of values of travel time savings (VTTS), an increasingly important application has been to calculate the potential revenues from tolled roads and networks with user charges, which offer high speeds at a higher price. It is shown that some common practices risk substantial error in calculation, affecting the sharing of risk between public and private sectors. A particularly important case is where an average value is taken as representative of a skewed distribution of values. In these circumstances there will be a tendency to overestimate the revenue and underestimate the traffic impact of a charge, because for a given mean VTTS, there will be a smaller number of individuals who are prepared to pay the toll. To correct this bias, the main tasks are: establishing a relevant set of trip-purpose specific VTTS distributions and selecting a way of handling the distributions in patronage forecasting; growing VTTS through time; treating the VTTS of car passengers; and establishing an appropriate set of rules for converting disaggregated (or heterogeneous) components of travel time values into a single trip value appropriate to the project being evaluated. Other related problems of the use of values of time relate to the assumption that these values grow in proportion to income, and the extent to which they are confounded with other effects. One troublesome feature is that most if not all of the problems discussed tend to risk overestimating revenue in the short and long run. This produces a tendency to appraisal bias, which can distort the contractual confidence between partners. Current assumptions in general appear to be overestimating the financial viability of projects while underestimating the degree of toll-avoiding behavior.

  • Availability:
  • Corporate Authors:

    Elsevier

    The Boulevard, Langford Lane
    Kidlington, Oxford  United Kingdom  OX5 1GB
  • Authors:
    • Hensher, D A
    • GOODWIN, P
  • Publication Date: 2004-4

Language

  • English

Media Info

Subject/Index Terms

Filing Info

  • Accession Number: 00974025
  • Record Type: Publication
  • Files: TRIS, ATRI
  • Created Date: May 17 2004 12:00AM