This paper explores several aspects of the implications of dynamic approaches to the economic evaluation of transport. Special attention is given to car ownership and use. It is intended as an initial contribution to discussion. The concept of a `dynamic model' is defined, and its advantages are considered. The advantages include: (1) closer correspondence to real behaviour; and (2) ability to find out when an effect will occur. A mathematical formulation is given of the implications of dynamic price elasticities for consumer surplus measurement, and for demand changes that take a significant time to be completed. The dynamic elasticities for car ownership and use are then estimated. There is a discussion of some special features of importance, when considering the evaluation of transport policies designed to improve the environment. Examples are provided which show that dynamic analysis can be as important in evaluating environmental policies as it is when evaluating more traditional transport policy objectives. Applications are made to time scales of environmental impacts and environmentally friendly transport policies, and to the estimation of behavioural values of time, usually for incorporation in cost-benefit analyses. This paper was presented at the 11th Annual Conference on Transport Research, Linköping, Sweden, 12-13 January 1994.
Abstract