The author considers that in the literature on the value of travel time, a good deal of interest has been focused on the question of whether, and how, the value of time varies with income, trip length, and "amount of time" saved. This interest is felt to relate to an underlying doubt as to the appropriateness of microeconomic theory, which predicts a close dependence of value of time on income but not on account of time saved, since value of time is defined with respect to marginal changes in travel time, the rejected alternatives being irrelevant. Thus, strong evidence that value of time does vary with the time difference between the chosen and the next best alternative, or that it does not vary with income, would cast doubt on the microeconomic approach. Empirical work by Hensher is reported which indicates such evidence, and which also argues for an alternative method of consumer behaviour which forms the basis of the quoted empirical results. The author considers that the purpose of this comment is first, to demonstrate that Hensher's conclusion, if valid, would indeed contradict the "revealed preference" or utilisation approach to consumer theory usually favoured by economists; and secondly, to argue that Hensher's statistical work and theoretical arguments are faulty, and cannot be said to add any evidence regarding the questions at issue. A rejoinder by Hensher follows this comment. /TRRL/

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  • Corporate Authors:

    London School of Economics and Political Science

    Houghton Street, Aldwych
    London WC2A 2AE,   England 
  • Authors:
    • Small, K A
  • Publication Date: 1978-1

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Filing Info

  • Accession Number: 00178666
  • Record Type: Publication
  • Source Agency: Transport and Road Research Laboratory (TRRL)
  • Files: ITRD, TRIS
  • Created Date: Sep 27 1981 12:00AM