Estimating Income Effects • Can represent effects of income on travel time and travel cost utilities in several forms, e.g.: 1. Utilities inversely or directly proportional to income: 2. Utilities affected by income in elasticity form:
Estimating Distance Effects • Sensitivity to travel time and cost have been seen to vary with trip distance • These effects can be represented as below
Variations in Values of Time • Data compiled from 22 independent studies conducted in different geographies; VOT estimated with similar methods $25 y = 8E-05x + 4.4368 R 2 = 0.2493 $20 $15 VOT ($/hr) $10 $5 $0 $0 $20,000 $40,000 $60,000 $80,000 $100,000 $120,000 $140,000 $160,000 Average Annual Household Income • Overall, VOTs average 56% of wage rate but vary between 25% and 95% OF INCOME
Variations in Values of Time (2) • Values of time also vary by average trip distance y = 0.0949x + 7.0722 $25 R 2 = 0.0875 $20 $15 VOT ($/hr) $10 $5 $0 20 30 40 50 60 70 80 Average Commute Trip Duration (minutes)
Variations in VOT Over Time • Average VOTs appear to be increasing at least with the CPI 1.70 Consumer Price Index Wage Rate 1.60 Value of Time 1.50 1.40 1.30 1.20 1.10 1.00 2003 2004 2005 2006 2007 2008
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