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The Relationship Between Fare and Travel Distance

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  • Finn Jørgensen
  • John Preston

Abstract

This paper develops a model to examine how a transport operator who is concerned about both profit and consumer surplus will design a uniform fare scheme and the relationship between fare and travel distance within such a scheme. The paper also analyses how travellers' generalised cost are linked to trip length. It is shown that how fare and generalised cost relate to trip length is critically dependent on the weight the transport operator puts on profit and the assumptions made about the demand conditions. The model's results are discussed in the light of Norwegian data for bus and ferry transport. © 2007 LSE and the University of Bath

Suggested Citation

  • Finn Jørgensen & John Preston, 2007. "The Relationship Between Fare and Travel Distance," Journal of Transport Economics and Policy, University of Bath, vol. 41(3), pages 451-468, September.
    • Handle: RePEc:tpe:jtecpo:v:41:y:2007:i:3:p:451-468
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    Citations

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    Cited by:

    1. Jørgensen, Finn & Mathisen, Terje Andreas & Larsen, Berner, 2011. "Evaluating transport user benefits and social surplus in a transport market--The case of the Norwegian ferries," Transport Policy, Elsevier, vol. 18(1), pages 76-84, January.
    2. Huang, Di & Liu, Zhiyuan & Liu, Pan & Chen, Jun, 2016. "Optimal transit fare and service frequency of a nonlinear origin-destination based fare structure," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 96(C), pages 1-19.
    3. Krzysztof Grzelec & Aleksander Jagiełło, 2020. "The Effects of the Selective Enlargement of Fare-Free Public Transport," Sustainability, MDPI, vol. 12(16), pages 1-18, August.
    4. Kamel, Islam & Shalaby, Amer & Abdulhai, Baher, 2020. "A modelling platform for optimizing time-dependent transit fares in large-scale multimodal networks," Transport Policy, Elsevier, vol. 92(C), pages 38-54.
    5. Clark, Derek J. & Mathisen, Terje Andreas, 2020. "Salience in a simple transport market," Research in Transportation Economics, Elsevier, vol. 82(C).
    6. Jackman, Mahalia & Lorde, Troy & Naitram, Simon & Greenaway, Tori, 2020. "Distance matters: the impact of physical and relative distance on pleasure tourists' length of stay in Barbados," Annals of Tourism Research, Elsevier, vol. 80(C).
    7. Saeed Maadi & Jan-Dirk Schmöcker, 2020. "Route choice effects of changes from a zonal to a distance-based fare structure in a regional public transport network," Public Transport, Springer, vol. 12(3), pages 535-555, October.
    8. Farber, Steven & Bartholomew, Keith & Li, Xiao & Páez, Antonio & Nurul Habib, Khandker M., 2014. "Assessing social equity in distance based transit fares using a model of travel behavior," Transportation Research Part A: Policy and Practice, Elsevier, vol. 67(C), pages 291-303.
    9. Jørgensen, Finn & Santos, Georgina, 2014. "Charges on transport – To what extent are they passed on to users?," Transportation Research Part A: Policy and Practice, Elsevier, vol. 69(C), pages 183-195.
    10. Clark, Derek J. & Jørgensen, Finn & Mathisen, Terje Andreas, 2011. "Relationships between fares, trip length and market competition," Transportation Research Part A: Policy and Practice, Elsevier, vol. 45(7), pages 611-624, August.
    11. Clark, Derek John & Jørgensen, Finn & Mathisen, Terje Andreas, 2014. "Competition in complementary transport services," Transportation Research Part B: Methodological, Elsevier, vol. 60(C), pages 146-159.
    12. Zhao, Pengjun & Zhang, Yixue, 2019. "The effects of metro fare increase on transport equity: New evidence from Beijing," Transport Policy, Elsevier, vol. 74(C), pages 73-83.

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