Travel time valuations play a crucial role in both the pre and post implementation appraisal of transport schemes. In fact, it has been estimated that time savings account for up to 80% of the monetised benefits of road investments. Conventional appraisal techniques assume that the valuation oftime is linear in form and calculate monetised benefits accordingly. However, research in other areas of economics suggests that individuals' valuations of attributes can often be non-linear. The purpose of this research is to evaluate the extent to which these non-linearities occur, particularly in the valuation of time and cost attributes. If non-linearities do exist and are not accounted for, this may lead to inaccurate demand forecastsand miscalculated welfare benefits. An analysis of some of these hypotheses has already been made using data from the first British value of time study, led by MVA. This study asked motorists to choose between a tolled and non-tolled route in a series of stated preference tasks. The results show that non-linearities do exist, particularly in the valuation of free-flow in-vehicle time (IVT). As expected, losses were valued more highly than gains for this attribute, however the difference was relatively small (approximately 20%). A 'size effect' was also found as respondents showed a decreased sensitivity to free-flow IVT gains with increased variation in theattribute. The cost parameter did not show a significant sign effect, however recent research suggests that money may not be subject to loss aversion as it is a good held explicitly for the purposes of exchange. This matter will be investigated further with the additional data sets, mentioned in the next section. The congested IVT attribute did not show significant sign or size effects; however this may have been due to the relatively small variation of this attribute. For the covering abstract see ITRD E135582.
Abstract