The Monetary Value of a Pleasant and Productive Train Trip

Abstract

The value of travel time saving(VOTTS) is very important in cost benefit analysis(CBA) as it is used to calculate the monetary gain in case of an improvement in transport that leads to reduction in travel time. Although it is easy to directly calculate monetary gains due to a speed improvement, monetary gains due to transport service improvement like comfort or ability to perform useful activities during a trip are far more difficult to include in CBA. This is because the total travel time stays the same before and after such service improvement since there is no visible reduction in total travel time. This is of course not true because travelers who travel comfortably and are able to engage in productive and pleasant activities during their trip can derive some benefits from the trip. These benefits can have an impact on the traveler’s VOTTS e.g. a reduction in the VOTTS of the traveler.
In order to measure this impact and calculate the monetary value of activities, a new methodology is proposed. The intuition behind the method is that the same traveler might have two different VOTTS. One VOTTS when he/she is able to make productive or pleasant use of the travel time by engaging in a preferred activity and another VOTTS when he/she cannot engage in the preferred activity during the journey. If the VOTTS without the activity is higher than the VOTTS with the activity, then the difference between these two VOTTS can be conceptualized as the monetary value of the activity.
The proposed methodology was translated into a hypothetical stated choice experiment with in-vehicle time and cost attributes. Respondents were recruited from train travellers on Netherlands Railways(NS) panel. The VOTTS of respondents with and without the ability to perform their preferred activity was then calculated. The results show that the ability to perform certain preferred activities like reading, working and listening to music during train trips, reduces the VOTTS especially for commuters by about 5euros/hour. For leisure travellers, reading was found to reduce the VOTTS by about 3euros/hr. The research concludes with a discussion on the general implication of results for transport project evaluations and investments. Based on this, some recommendations are made for NS and also for the Netherlands institute for transport policy analysis(KiM) regarding future VOTTS calculations that will be used in transport project evaluations.