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The value of local railways: An approach using the contingent valuation method

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  • Utsunomiya, Kiyohito

Abstract

In Japan, many local railway lines in regional areas are on the brink of closure due to accumulated deficits. Although railways are generally said to have their own option and non-use values compared with buses, conventional cost benefit analysis does not evaluate these values sufficiently because there have been few quantitative research studies into this issue. This paper, focusing on three different Japanese local railways, estimates railways’ additional value over buses using the contingent valuation method (CVM). The CVM here is to estimate not an absolute total economic value of a specific railway but a relative value of railway to replacement buses. Therefore, our survey research has the advantage that data obtained from different railways can be comparable to a certain extent. The results show that two of three cases have their own additional value over buses of around twenty percent, and the other one has additional value of around ten percent. There is no big difference in evaluation between direct users and non-users at present. Also, the survey shows that, if train frequency increases, a certain number of residents, including potential users, are willing to pay more than the current fares.

Suggested Citation

  • Utsunomiya, Kiyohito, 2018. "The value of local railways: An approach using the contingent valuation method," Research in Transportation Economics, Elsevier, vol. 69(C), pages 554-559.
    • Handle: RePEc:eee:retrec:v:69:y:2018:i:c:p:554-559
    DOI: 10.1016/j.retrec.2018.05.003
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    References listed on IDEAS

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    1. Laird, James & Geurs, Karst & Nash, Chris, 2009. "Option and non-use values and rail project appraisal," Transport Policy, Elsevier, vol. 16(4), pages 173-182, August.
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    Cited by:

    1. Utsunomiya, Kiyohito & Shibayama, Takeru, 2021. "Rail bonus: An empirical study onto relative valuation of railways in Austria," Transport Policy, Elsevier, vol. 113(C), pages 37-45.
    2. Shahin Shakibaei & Pelin Alpkokin, 2019. "Conflict Resolution in Competitive Liberalized Railway Market: Application of Game Theoretic Concepts," International Game Theory Review (IGTR), World Scientific Publishing Co. Pte. Ltd., vol. 22(01), pages 1-21, November.
    3. Alessandro Severino & Larysa Martseniuk & Salvatore Curto & Larysa Neduzha, 2021. "Routes Planning Models for Railway Transport Systems in Relation to Passengers’ Demand," Sustainability, MDPI, vol. 13(16), pages 1-27, August.
    4. Jaime Larumbe, 2021. "Measuring Customer Reservation Price for Maintenance, Repair and Operations of the Metro Public Transport System in Qatar," Sustainability, MDPI, vol. 13(19), pages 1-16, October.

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    More about this item

    Keywords

    Local railway; Option value; Non-use value; CVM; Transport appraisal; Transport policy; Japan;
    All these keywords.

    JEL classification:

    • R40 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - General
    • R42 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government and Private Investment Analysis; Road Maintenance; Transportation Planning

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