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How should business travel time savings be valued?

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  • Wardman, Mark
  • Batley, Richard
  • Laird, James
  • Mackie, Peter
  • Bates, John

Abstract

This paper provides the most extensive appraisal yet of the methods for valuing business travel time savings. From both theoretical and empirical perspectives, we review the traditional Cost Savings Approach (CSA), which has long been dominant in appraisal practice worldwide, alongside its main rivals, namely the Hensher Equation (HE) and the Willingness-To-Pay (WTP) approach.

Suggested Citation

  • Wardman, Mark & Batley, Richard & Laird, James & Mackie, Peter & Bates, John, 2015. "How should business travel time savings be valued?," Economics of Transportation, Elsevier, vol. 4(4), pages 200-214.
    • Handle: RePEc:eee:ecotra:v:4:y:2015:i:4:p:200-214
    DOI: 10.1016/j.ecotra.2015.08.003
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    References listed on IDEAS

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    1. André de Palma & Robin Lindsey & Emile Quinet & Roger Vickerman (ed.), 2011. "A Handbook of Transport Economics," Books, Edward Elgar Publishing, number 12679.
    2. Shires, J.D. & de Jong, G.C., 2009. "An international meta-analysis of values of travel time savings," Evaluation and Program Planning, Elsevier, vol. 32(4), pages 315-325, November.
    3. André de Palma & Robin Lindsey & Emile Quinet & Robert Vickerman, 2011. "Handbook Of Transport Economics," PSE-Ecole d'économie de Paris (Postprint) halshs-00754912, HAL.
    4. David A. Hensher, 2011. "Valuation of Travel Time Savings," Chapters, in: André de Palma & Robin Lindsey & Emile Quinet & Roger Vickerman (ed.), A Handbook of Transport Economics, chapter 7, Edward Elgar Publishing.
    5. Abrantes, Pedro A.L. & Wardman, Mark R., 2011. "Meta-analysis of UK values of travel time: An update," Transportation Research Part A: Policy and Practice, Elsevier, vol. 45(1), pages 1-17, January.
    6. Mark Wardman & Gerard Whelan, 2011. "Twenty Years of Rail Crowding Valuation Studies: Evidence and Lessons from British Experience," Transport Reviews, Taylor & Francis Journals, vol. 31(3), pages 379-398.
    7. Small, Kenneth A., 2012. "Valuation of travel time," Economics of Transportation, Elsevier, vol. 1(1), pages 2-14.
    8. Richard Batley, 2015. "The Hensher equation: derivation, interpretation and implications for practical implementation," Transportation, Springer, vol. 42(2), pages 257-275, March.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Richard Batley & John Bates & Michiel Bliemer & Maria Börjesson & Jeremy Bourdon & Manuel Ojeda Cabral & Phani Kumar Chintakayala & Charisma Choudhury & Andrew Daly & Thijs Dekker & Efie Drivyla & Ton, 2019. "New appraisal values of travel time saving and reliability in Great Britain," Transportation, Springer, vol. 46(3), pages 583-621, June.
    2. Chiara Calastri & Jacek Pawlak & Richard Batley, 2022. "Participation in online activities while travelling: an application of the MDCEV model in the context of rail travel," Transportation, Springer, vol. 49(1), pages 61-87, February.
    3. Wardman, Mark & Chintakayala, V. Phani K. & de Jong, Gerard, 2016. "Values of travel time in Europe: Review and meta-analysis," Transportation Research Part A: Policy and Practice, Elsevier, vol. 94(C), pages 93-111.
    4. Georgina Santos, 2018. "Sustainability and Shared Mobility Models," Sustainability, MDPI, vol. 10(9), pages 1-13, September.
    5. Alderighi, Marco & Gaggero, Alberto A., 2017. "Fly and trade: Evidence from the Italian manufacturing industry," Economics of Transportation, Elsevier, vol. 9(C), pages 51-60.
    6. Mark Wardman & Phani Chintakayala & Chris Heywood, 2020. "The valuation and demand impacts of the worthwhile use of travel time with specific reference to the digital revolution and endogeneity," Transportation, Springer, vol. 47(3), pages 1515-1540, June.
    7. Shamshiripour, Ali & Rahimi, Ehsan & (Kouros) Mohammadian, Abolfazl & Auld, Joshua, 2020. "Investigating the influence of latent lifestyles on productive travels: Insights into designing autonomous transit system," Transportation Research Part A: Policy and Practice, Elsevier, vol. 141(C), pages 469-484.
    8. Iain Docherty & Jon Shaw & Greg Marsden & Jillian Anable, 2018. "The curious death – and life? – of British transport policy," Environment and Planning C, , vol. 36(8), pages 1458-1479, December.
    9. Ilka Dubernet & Kay W. Axhausen, 2020. "The German value of time and value of reliability study: the survey work," Transportation, Springer, vol. 47(3), pages 1477-1513, June.
    10. Glenn P. Jenkins & Pejman Bahramain & Mikhail Miklyaev & Saint Seyi Akindere, 2019. "Social Value of Time for Investment Appraisal in Mozambique," Development Discussion Papers 2019-05, JDI Executive Programs.
    11. Rashidi, Taha Hossein & Waller, Travis & Axhausen, Kay, 2020. "Reduced value of time for autonomous vehicle users: Myth or reality?," Transport Policy, Elsevier, vol. 95(C), pages 30-36.
    12. Merkert, Rico & Beck, Matthew J., 2020. "Can a strategy of integrated air-bus services create a value proposition for regional aviation management?," Transportation Research Part A: Policy and Practice, Elsevier, vol. 132(C), pages 527-539.
    13. Tjiong, Jeff & Dekker, Thijs & Hess, Stephane & Ojeda Cabral, Manuel, 2022. "The selection of income measures in value of travel time models and their implications for the VTT, its cross-sectional income elasticity and transport appraisal," Research in Transportation Economics, Elsevier, vol. 94(C).

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