Welfare Estimates of Shifting Peak Travel

Robert W. Hahn, Robert Metcalfe () and Eddy Tam

No 31629, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We develop novel estimates of peak and off-peak price elasticities for urban mass transit demand in San Francisco using a large natural experiment with 3.6 million trip sessions and a natural field experiment that both have exogenous price subsidies. We then estimate the welfare impacts for these price subsidies using a sufficient statistics approach. Our analysis suggests that off-peak subsidies can increase welfare, but the positive effects are reduced when consumers take the decisions of others into account compared to when they do not. We also find a large variation in the welfare impacts of shifting travel to different periods, which is explained by differences in demand and congestion characteristics. Finally, we show that the targeting of subsidies can increase welfare, but need not do so if the regulator does not have accurate information on demand.

JEL-codes: H20 R41 (search for similar items in EconPapers)
Date: 2023-08
New Economics Papers: this item is included in nep-ene, nep-exp, nep-ger, nep-pbe, nep-tre and nep-ure
Note: EEE PE
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