The Individual Travel Cost Method with Consumer-Specific Values of Travel Time Savings
Mikolaj Czajkowski (),
Marek Giergiczny (),
Jakub Kronenberg () and
Jeffrey Englin ()
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Marek Giergiczny: University of Warsaw
Jakub Kronenberg: University of Lodz
Jeffrey Englin: Arizona State University
Environmental & Resource Economics, 2019, vol. 74, issue 3, No 3, 984 pages
Abstract The treatment of the opportunity cost of travel time in travel cost models has been an area of research interest for many decades. Our analysis develops a methodology to combine the travel distance and travel time data with respondent-specific estimates of the value of travel time savings (VTTS). The individual VTTS are elicited with the use of discrete choice stated preference methods. The travel time valuation procedure is integrated into the travel cost valuation exercise to create a two-equation structural model of site valuation. Since the travel time equation of the structural model incorporates individual preference heterogeneity, the full structure model provides a travel cost site demand model based upon individualized values of time. The methodology is illustrated in a study of recreational birdwatching, more specifically, visits to a ‘stork village’ in Poland. We show that the usual practice of basing respondents’ VTTS on 1/3 of their wage rate is largely unfounded and propose alternatives—including a separate component of the travel cost survey aimed at valuation of respondents’ VTTS or, as a second best, asking if they wish if their journey was shorter and for those who do—use full hourly wage as an indicator of their VTTS.
Keywords: Opportunity cost of travel time; Individual-specific values of travel time savings; Travel cost method; Discrete choice experiment; Integration of valuation methods; Recreational birdwatching (search for similar items in EconPapers)
JEL-codes: Q26 Q51 Q57 (search for similar items in EconPapers)
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Working Paper: The Individual Travel Cost Method with Consumer-Specific Values of Travel Time Savings (2015)
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