Why do people fare evade? A global shift in fare evasion research

ABSTRACT

Fare evasion is a significant concern for most transit authorities. The traditional approach to fare compliance has focussed on modifying the physical control of ticketing or ticket inspection rates. Yet recently the perspective on fare evasion has begun to shift toward profiling the fare evader or understanding the customer motivations to fare evade. This paper uses a literature review method to document the characteristics of these three perspectives on fare evasion: the conventional transit system perspective, the customer profiling perspective and the customer motivations perspective. We find that the conventional transit system perspective, although straightforward to measure and control, has its limits particularly in “open” transit systems. The customer profiling perspective attempts to identify, based on demographics, which customers are more likely to fare evade. However this perspective has little use beyond profiling and is ethically questionable. The customer motivations perspective provides a richer understanding of how customers define fare evasion and what attitudes, social norms and circumstances motivates them to fare evade. Considering that between 20% and 40% of a city’s residents admit to fare evading at some point, understanding these complex motivations can help improve revenue compliance at a time when most governments heavily subsidise their transit systems.     

What are the determinants in making people free riders in proof-of-payment transit systems? Evidence from Italy

Nowadays, in proof-of-payment transit systems, fare evasion is provoking strong interest in public transport companies (PTCs) due to the relevant economic losses, social inequity and increased levels of violence affecting personal security. Therefore, there is the need to recognize possible fare evaders. By using 2177 on-board personal interviews, gathered from an Italian PTC, and logistic regression models, we isolate determinants of possible free-rider passengers and, hence, those whom it might be advisable to target in order to capitalize on the effect of the application of countermeasures on fare evasion put forward by the local PTC. We show that males, younger than 26 years, with a low education level, unemployed and/or students and without an alternative mode of transport other than the bus are more probably fare evaders. Moreover, people who make trips of shorter than 15 min, who are systematic users and are not satisfied with the service are possible fare evaders. Finally, we found that a low level of inspection, knowledge of fines and previous ticket violations are determinants which make people more prone to evade fares. These outcomes are very useful, because, to the best of our knowledge, they represent the first empirical contribution showing the determinants which help evaluate the propensity to be a fare evader, in probabilistic terms. Moreover, they could help PTCs understand who might be a fare evader, in order to anticipate suitable countermeasures.     

Estimating multimodal transit ridership with a varying fare structure

This paper studies public transport demand by estimating a system of equations for multimodal transit systems where different modes may act competitively or cooperatively. Using data from Athens, Greece, we explicitly correct for higher-order serial correlation in the error terms and investigate two, largely overlooked, questions in the transit literature; first, whether a varying fare structure in a multimodal transit system affects demand and, second, what the determinants of ticket versus travelcard sales may be. Model estimation results suggest that the effect of fare type on ridership levels in a multimodal system varies by mode and by relative ticket to travelcard prices. Further, regardless of competition or cooperation between modes, fare increases will have limited effects on ridership, but the magnitude of these effects does depend on the relative ticket to travelcard prices. Finally, incorrectly assuming serial independence for the error terms during model estimation could yield upward or downward biased parameters and hence result in incorrect inferences and policy recommendations.     

Estimation of rail passenger flow and system utilization with ticket transaction and gate data

Capturing the dynamics in passenger flow and system utilization over time and space is extremely important for railway operators. Previous studies usually estimated passenger flow using automatic fare collection data, and their applications are limited to a single stopping pattern and/or a single type of ticket. However, the conventional railway in Taiwan provides four types of ticket and five types of train service with a number of stopping patterns. This study develops a comprehensive framework and corresponding algorithms to map passenger flow and evaluate system utilization. A multinomial logit model is constructed and incorporated in the algorithms to estimate passenger train selection behavior. Results from the empirical studies demonstrate that the developed framework and algorithms can successfully match passengers with train services. With this tool, operators can efficiently examine passenger flow and service utilization, thereby quickly adjusting their service strategies accordingly to improve system performance.     

A comparative study of aggregate and disaggregate gravity models using Seoul metropolitan subway trip data

Abstract

Existing origin constrained and doubly constrained gravity models have not been compared, theoretically or empirically, in terms of their forecasting power. Due to the newly advanced technology of intelligent transport systems, the expanded data presently available have made various models more comparable in terms of forecasting power. This paper uses archived automatic passenger counting (APC) data for urban rail in the Seoul metropolitan area. The APC data contains information about each trip's origin, destination, ticket type, fare, and distance on a daily basis. The objective of this paper is to compare the goodness-of-fit of aggregate and disaggregate gravity modeling using these data. A Hyman aggregate gravity model is used as the aggregate model without the spatial effect. The disaggregate model adopts a multinomial logit as the destination choice model with the spatial effect. In general, while the formulation of aggregate and disaggregate gravity model models are similar, the calibration and parameter estimation methods of the two models are different. As a result, this empirical study demonstrates that the variation in goodness-of-fit and forecasting power largely depends on the estimation method and selected variables. The forecasting power of the disaggregate modeling approach outperforms that of the aggregate model. This paper further confirms that spatial arrangement plays important roles in gravity modeling.     

Cost and time damping: evidence from aggregate rail direct demand models

There is a significant body of evidence from both disaggregate choice modelling literature and practical travel demand forecasting that the responsiveness to cost and possibly to time diminishes with journey length. This has, in Britain at least, been termed ‘Cost Damping’, and is recognised in guidance issued by the UK Department for Transport. However, the consistency of the effect across modes and data types has not been established. Cost damping, if it exists, affects both the forecasting of demand and our understanding of behaviour. This paper aims to investigate the evidence for cost and time damping in rail demand using aggregate rail ticket sales data. The rail ticket sales data in Britain has, for many years, formed the basis of analysis of a wide range of impacts of rail demand. It records the number of tickets sold between station pairs, and it is generally felt to provide a reasonably accurate reflection of travel demand. However, the consistency of these direct demand models with choice modelling and highway demand model structures has not been investigated. Rail direct demand models estimated by ticket sales data indicate only slight variation in the fare elasticity with distance, as is evidenced in the largest meta-analysis of price elasticities conducted to date (Wardman in J Transp Econ Policy 48(3):367–384, 2014). This study of UK elasticities shows strong variation between urban and inter-urban trips, presumably a segmentation at least in part by purpose, but less remaining variation by trip length. A lack of variation by length supports the hypothesis of cost damping, because constant cost sensitivity would imply that fare elasticity would increase strongly with distance, because of the increasing impact of higher fares at longer distances. In this paper we indicate that rail direct demand models have some consistency of behavioural paradigm with utility based choice models used in highway planning. We go on to use rail demand data to estimate time and fare elasticities in the context of various cost damping functions. Our empirical contribution is to estimate time elasticities on a basis directly comparable with cost elasticities and to show that the phenomenon of cost damping is strongly present in ticket sales data. This finding implies that cost damping should be included in models intended for multimodal analysis, which may otherwise give incorrect predictions.     

Further developments in the pricing of local public transport

Abstract

This short paper supplements and updates the writer's Recent Developments in the Pricing of Local Public Transport Services, Transport Reviews, 1 (2), pp. 127–150 (1981). That paper described the situation as at 1980 in Britain, with some examples from other countries. This paper updates the position with regard to four main issues:

(a) Impact of the Transport Act 1980 in Britain, which has virtually removed fares control from stage carriage services, and removed all price and quantity control from express services by road.

(b) Further development of zonal pricing, travelcards and off‐bus fare collection on urban systems, and the effects of price reductions (and subsequent increases) in London, West Midlands, and Merseyside.

(c) Problems concerning the legality of financial support for fares policies in British cities.

(d) Following a presentation of work arising from the earlier paper at the meeting of the Transportation Research Board in Washington, D.C. in January 1983, the contrast between British and American policy is reviewed, with the writer's personal view on current policy there.

In addition, evidence on certain other points in the text is updated.     

Impact evaluation of a mass transit fare change on demand and revenue utilizing smart card data

Transit fares are an effective tool for demand management. Transit agencies can raise revenue or relieve overcrowding via fare increases, but they are always confronted with the possibility of heavy ridership losses. Therefore, the outcome of fare changes should be evaluated before implementation. In this work, a methodology was formulated based on elasticity and exhaustive transit card data, and a network approach was proposed to assess the influence of distance-based fare increases on ridership and revenue. The approach was applied to a fare change plan for Beijing Metro. The price elasticities of demand for Beijing Metro at various fare levels and trip distances were tabulated from a stated preference survey. Trip data recorded by an automatic fare collection system was used alongside the topology of the Beijing Metro system to calculate the shortest path lengths between all station pairs, the origin–destination matrix, and trip lengths. Finally, three fare increase alternatives (high, medium, and low) were evaluated in terms of their impact on ridership and revenue. The results demonstrated that smart card data have great potential with regard to fare change evaluation. According to smart card data for a large transit network, the statistical frequency of trip lengths is more highly concentrated than that of the shortest path length. Moreover, the majority of the total trips have a length of around 15 km, and these are the most sensitive to fare increases. Specific attention should be paid to this characteristic when developing fare change plans to manage demand or raise revenue.     

Matatu: A Case Study of the Core Segment of the Public Transport Market of Kampala,Uganda

Abstract

In Uganda, public transport is provided by a four‐tiered public transport system, with the Matatu (usually Toyota cabin‐transporters of 1990s make) as its backbone, providing the widest, densest and cheapest connectivity. The article shares findings of a survey on perceptions, profiles and aspirations of drivers/conductors/stage personnel and of passengers. They show that entering a career within the Matatu business opens choices and promises inclusion into a relatively strong social network. For passengers, the Matatu offers a cost‐effective opportunity to commute to places of work, transport goods and connect with business partners. The findings also point to limitations of the current public transport system, with emphasis on lacking client care, e.g. fare cheating by conductors. There is a need to better understand the dynamics of urban transport systems against the background of expanding urbanization in low‐income countries. This article has attempted to contribute to that need.     

The treatment of traffic in the Dutch environmental outlooks: the role of science in policy making and policy evaluation

The Dutch National Institute of Public Health and Environmental Protection publishes Environmental Outlooks in which 25‐year projections are made. These Outlooks quantifying the environmental problems, form the scientific basis for Dutch environmental policy. Traffic and transport is one of the main sectors causing environmental problems. The emissions and energy use of all relevant categories (road traffic, non‐road traffic) are based on model simulations with models. This paper describes the main models used.

If present policy is implemented only a minority of the environmental targets will be met.

If a sustainable transport system for the Netherlands means a large reducton in CO₂ emissions and energy use after 2010 a stronger emphasis on both technical and non‐technical measures (such as land‐use planning combined with public transport improvements) for the period until 2010 is needed than proposed in the Second Transport Structure Plan, unless a sustainable energy source becomes available.     

Willingness to Pay for Airline Service Quality

Abstract

This paper looks at estimated valuations of some service‐quality attributes in an airline choice context using stated preferences methods. The analysis is based on information obtained in the most important route connecting the Canary Islands with the Iberian Peninsula: Gran Canaria–Madrid, and tries to contribute to the body of knowledge in this area, given the relatively few studies of the monetary valuations of air travel regarding level‐of‐service attributes. A feature of this analysis is the examination of variations in values according to different characteristics of the service, such as price, penalties for changes in the ticket, legroom, food, etc.; the currently experienced level of the attribute, and various socio‐economic factors that affect the characteristics of the trip and passengers. In addition, the important issue of added value regarding different attributes is addressed, obtaining the willingness‐to‐pay for different improvements of service quality. A further analysis is made about how taste heterogeneity (market segments) affects these values. Results from the stated preference experiment and the market value of some comparable service are also compared. Finally, the paper brings together evidence from other studies and compares them with the findings obtained herein.     

The demand for public transport. part II. supply and demand factors of public transport

Abstract

This two‐part article, concerned with the way public transport ridership is affected by the various relevant factors, is based on the Executive Summary of The Demand for Public Transport (Webster and Bly 1980), the report of the TRRL‐sponsored International Collaborative Study on Factors Affecting Public Transport Patronage. Part I of the article, which was concerned with the social and economic conditions in which public transport operates, showed the importance of the background factors such as income, car ownership and land use on public transport usage: it also indicated how the longer‐term impacts of the more direct demand factors (fares, service levels) often show themselves in changes in car ownership levels, activity patterns (i.e. where people live, work, shop, socialize, etc) and land‐use development.

Part II reviews the current state of knowledge on the effects of changes in fare levels and quality of service and of the introduction of various traffic and transport measures (traffic restraint, bus priority, etc): it outlines current methodology on costing public transport services and draws the supply and demand sides together in a consideration of particular strategies which are at the disposal of the operator, the planner and the policy maker.     

Automatic fare collection in transit: a synthesis of current practice

Many industries are keeping pace with changing technology in an effort to improve operating efficiency and attract consumers with innovations. The transit industry is no exception, one example being the installation and operation of automatic fare‐collection (AFC) systems. There are many issues to consider in implementing an AFC system, including the type of equipment required and the expected quality of system performance.

This article presents a synthesis of several sources of information pertaining to AFC operations. It includes a discussion of system requirements, and the advantages and disadvantages of system operation. Performance measures of reliability and maintainability are also defined, and AFC systems are evaluated using these measures. Several conclusions are reached concerning current AFC practice.     

Monopoly,Subsidies and the Mohring Effect: A Synthesis

Abstract

This paper provides a unifying framework to analyze whether a monopoly transit provider will under or over-supply frequency. To this end we couch the problem in term of Spence [(1975). Monopoly, quality and regulation. The Bell Journal of Economics, 6, 417–429] who analyzed the incentives to provide quality by a monopolist. We show that all of the results of a recent academic exchange discussing this topic are special cases of Spence [(1975). Monopoly, quality and regulation. The Bell Journal of Economics, 6, 417–429], albeit with an adjustment in order to take into account the cost structure of frequency provision in the case of public transport. In theory then, there are cases when a monopolist may offer optimal or above optimal levels of frequency without requiring subsidies. However, public transport is rarely provided by an unregulated monopolist. Rather, these services are usually provided either by an exclusive operator under regulated fares or by a group of competing operators, with or without fare regulation. We show that in the first case frequency will always be below the social optimal level.     

Collective public-transport tickets and anticipated majority choice: A model of student tickets

In Germany, many universities have student tickets that are bargained for between student representatives and public transport companies, approved by referendum, and mandatory for all students. They allow the use of public transport at no additional cost. I analyze such a scenario in a theoretical model as an example of a flat-rate ticket for public transport which is implemented by majority decision. The mandatory character of the ticket reduces transaction costs like marketing and ticket inspection, reducing the ticket price and thus the students’ commuting expenses. However, there is a countervailing effect. Students face and rationally expect zero marginal monetary commuting costs, so that new students choose a place of residence which is relatively far from the university. This in turn raises the equilibrium ticket price. It may even be the case that students would be better off if such a ticket had never existed. Nonetheless, they always vote for it in referenda, because accepting the high price is optimal given their place of residence. After laying out the model, I analyze an optimal policy, which consists, for example, of subsidizing student dorms at an efficient distance to the city center.     

Experience in judging controversial road projects

Abstract

Road construction of all kinds, especially of urban motorways, has in recent years acquired a very bad reputation in industrialized countries. Traffic engineers are, because of their attitude, not entirely without blame for this development. With their attention glued nearly hypnotically to dimensions and technical design, considerations about the meaning and function of the construction are very often neglected, all the more since the engineers might otherwise risk their own jobs. It is, however, becoming increasingly clear that the cause of the scepticism and uneasiness prevailing in the public is the lack of a comprehensive judgement. Using a concrete example, this paper describes how decision‐making can degenerate when such judgement is omitted. Using a second example, it is then demonstrated how such a comprehensive judgement can be integrated in decision‐making from the very beginning. Such an integration sets very high methodological and procedural standards and constructive aids are offered for this purpose. It is shown that, while the substantial findings of a comprehensive judgement should be logically consistent, plausible and up to the latest standard of knowledge, the nature and intelligibility of the presentation and the preparedness for a publicly presented explanation in the form of ‘after‐care’ are of much greater importance for decision‐making in the political sphere. This ‘after‐care’ should accordingly become an indispensable component of the decision‐making process.

All those involved should become aware of the fact that a ‘positive’ result of decision‐making in the field of road construction is not a priori defined as the construction of road and a ‘negative’ one as its prevention. The actual positive result is rather the creation of a consciousness of the problem on hand, which can serve as a basis on which a decision is taken in full realization of all its consequences.     

Optimization of Fare Structure and Service Frequency for Maximum Profitability of Transit Systems

Abstract

Providing efficient public transportation has been recognized as a potential way of alleviating congestion, improving mobility, mitigating air pollution, and reducing energy consumption. Many people use public transportation systems for their daily commute, while others use different transportation modes (e.g. cars, taxis, carpools, etc.). Inexpensive fares with good transit service encourages ridership, and the resulting revenue may be used to provide better service. Optimization of transit service frequency and its associated fare structure is desirable in order to increase revenue at reasonable transit operating expenditure. The objective of the study reported here is to maximize profit subject to service capacity constraint, while elastic demand is considered. The solution methodology is developed and applied to solve the profit maximization problem in a case study based on Newark, NJ, USA. Numerical results, including optimal solutions and sensitivity analyses, are presented. It is found that an optimal temporal headway and differential fare structure that maximizes total profit for the studied subway system can be efficiently solved.     

Impact of information technology on public transport fares data

The work described was undertaken as part of the CASSIOPE project in the EC DRIVE programme. A range of fare collection procedures in public transport is described, and the importance of these for data collection by operators is stressed. It is suggested that such data management could be standardized and to this end four case studies were carried out in different European cities. Data models were built for each city, and these models are merged into a preliminary version of a generalized model. The need and uses for such a fare collection data model is explained.     

Passengers’ response to transit fare change: an ex post appraisal using smart card data

Fare change is an effective tool for public transit demand management. An automatic fare collection system not only allows the implementation of complex fare policies, but also provides abundant data for impact analysis of fare change. This study proposes an assessment approach for analyzing the influence when substituting a flat-fare policy with a distance-based fare policy, using smart card data. The method can be used to analyze the impact of fare change on demand, riding distances, as well as price elasticity of demand at different time and distance intervals. Taking the fare change of Beijing Metro implemented in 2014 as a case study, we analyze the change of network demand at various levels, riding distances, and demand elasticity of different distances on weekdays and weekends, using the method established and the smart card data a week before and after the fare change. The policy implication of the fare change was also addressed. The results suggest that the fare change had a significant impact on overall demand, but not so much on riding distances. The greatest sensitivity to fare change is shown by weekend passengers, followed by passengers in the evening weekday peak time, while the morning weekday peak time passengers show little sensitivity. A great variety of passengers’ responses to fare change exists at station level because stations serve different types of land usage or generate trips with distinct purposes at different times. Rising fares can greatly increase revenue, and can shift trips to cycling and walking to a certain extent, but not so much as to mitigate overcrowding at morning peak times. The results are compared with those of the ex ante evaluation that used a stated preference survey, and the comparison illustrates that the price elasticity of demand extracted from the stated preference survey significantly exaggerates passengers’ responses to fare increase.     

The MEPLAN models of Bilbao,Leeds and Dortmund

A trio of closely related land‐use/transport interaction models was developed using Marcial Echenique & Partners’ software package MEPLAN. The models were for the cities of Bilbao, (Spain), Dortmund (West Germany) and Leeds (England). All were calibrated using data drawn from earlier studies. The three models were used to predict the effects (relative to a base case) of a common programme of land‐use and transport policies or scenarios. This paper explains briefly the theoretical basis of the MEPLAN package as applied to urban models such as these three; describes the types of policies that have been assessed; and presents some of the key results.