Using nonparametrics to specify a model to measure the value of travel time

TY - JOUR

T1 - Using nonparametrics to specify a model to measure the value of travel time

AU - Fosgerau, Mogens

PY - 2007/11

Y1 - 2007/11

N2 - Using a range of nonparametric methods, the paper examines the specification of a model to evaluate the willingness-to-pay (WTP) for travel time changes from binomial choice data from a simple time-cost trading experiment. The analysis favours a model with random WTP as the only source of randomness over a model with fixed WTP which is linear in time and cost and has an additive random error term. Results further indicate that the distribution of log WTP can be described as a sum of a linear index fixing the location of the log WTP distribution and an independent random variable representing unobserved heterogeneity. This formulation is useful for parametric modelling. The index indicates that the WTP varies systematically with income and other individual characteristics. The WTP varies also with the time difference presented in the experiment which is in contradiction of standard utility theory.

AB - Using a range of nonparametric methods, the paper examines the specification of a model to evaluate the willingness-to-pay (WTP) for travel time changes from binomial choice data from a simple time-cost trading experiment. The analysis favours a model with random WTP as the only source of randomness over a model with fixed WTP which is linear in time and cost and has an additive random error term. Results further indicate that the distribution of log WTP can be described as a sum of a linear index fixing the location of the log WTP distribution and an independent random variable representing unobserved heterogeneity. This formulation is useful for parametric modelling. The index indicates that the WTP varies systematically with income and other individual characteristics. The WTP varies also with the time difference presented in the experiment which is in contradiction of standard utility theory.

KW - Local logit

KW - Nonparametric

KW - Semiparametric

KW - Value of time

KW - Willingness-to-pay

KW - WTP

UR - http://www.scopus.com/inward/record.url?scp=34547193653&partnerID=8YFLogxK

U2 - 10.1016/j.tra.2006.10.004

DO - 10.1016/j.tra.2006.10.004

M3 - Journal article

AN - SCOPUS:34547193653

SN - 0965-8564

VL - 41

SP - 842

EP - 856

JO - Transportation Research Part A: Policy and Practice

JF - Transportation Research Part A: Policy and Practice

IS - 9 SPEC. ISS.

ER -