Transport Innovation: Coping with the Future

An efficient transport system is a crucial precondition for economic development and an asset in international mobility. Mobility of passengers and transport of goods are considered key elements for a modern society. The transport sector is also a sector of continuous technological innovation. However, there is considerable uncertainty surrounding future transport technology and policy, as well as a large variation in ways to deal with this uncertainty. With regard to the latter it may be helpful to use more than one foresight method, e.g. a combination of methods each with a different emphasis on expertise, creativity and interaction with actors. Such a multiple method approach allows for the identification of those futures or future developments that are robust. This paper provides an introduction to the topic of transport innovation as well as providing a context for the four papers which follow in this special issue, illustrating the importance of taking such a multiple method approach.     

Transport policy scenario-building

Long-term planning decisions must be as robust as possible to withstand such changes in the policy-making environment. This calls for a new approach for identifying how policies might fare under different types of conditions and for identifying robust no-regrets strategies. This paper outlines a systematic and logical framework for the development of policy scenarios and shows how scenarios can be used in the analysis of future policy options. The article discusses how scenario analysis can be used to identify, anticipate and assess policy options for the future in an environment of uncertainty, mainly using examples of transport policy in Europe.     

Does uncertainty make cost-benefit analyses pointless?

Cost-benefit analysis (CBA) is widely used in public decision making on infrastructure investments. However, the demand forecasts, cost estimates, benefit valuations and effect assessments that are conducted as part of CBAs are all subject to various degrees of uncertainty. The question is to what extent CBAs, given such uncertainties, are still useful as a way to prioritize between infrastructure investments, or put differently, how robust the policy conclusions of CBA are with respect to uncertainties. Using simulations based on real data on national infrastructure plans in Sweden and Norway, we study how investment selection and total realized benefits change when decisions are based on CBA assessments subject to several different types of uncertainty. Our results indicate that realized benefits and investment selection are surprisingly insensitive to all studied types of uncertainty, even for high levels of uncertainty. The two types of uncertainty that affect results the most are uncertainties about investment cost and transport demand. Provided that decisions are based on CBA outcomes, reducing uncertainty is still worthwhile, however, because of the huge sums at stake. Even moderate reductions of uncertainties about unit values, investment costs, future demand and project effects may increase the realized benefits infrastructure investment plans by tens or hundreds of million euros. We conclude that, despite the many types of uncertainties, CBA is able to fairly consistently separate the wheat from the chaff and hence contribute to substantially improved infrastructure decisions.     

Singapore: The Development of a World Class Transport System

Singapore's Land Transport Authority, formed in 1995, set itself a mission of producing a world class transport system. This paper assesses the extent to which this goal is being achieved. It outlines the structure within which transport decisions are taken and indicates the freedom this gives to develop integrated transport and land‐use strategies. It demonstrates the long‐term stability in transport strategy from 1972 onwards, and the key contributions to that strategy of land‐use controls and travel‐demand management measures. The individual elements of the strategy are then reviewed and innovations identified in demand management, public transport service provision and information technology. Finally, the key attributes that have led to the success of the strategy are identified, and it is suggested that many of these are transferable to other cities of the developed world.     

Towards improved port capacity investment decisions under uncertainty: a real options approach

ABSTRACT

Port activity plays an important role in facilitating international trade. Sufficient capacity is indispensable for a port to attract flows to a region and retain them. The capacity decision is the result of a trade-off between investment and waiting costs. Traditional methods to value expansion projects do not deal adequately with managerial flexibility in the face of uncertainty from different sources in the complex port environment. In this paper, real options (RO) models are identified as an alternative method to making project valuations and investment decisions, as they attribute the correct value to managerial flexibility under uncertainty. In order to be able to build and use such RO models for port capacity investment decisions, the sources and implications of uncertainty in the port and the different RO model specifications need to be understood. To this end, both the literature about uncertainty in the port context and the literature about real options models are reviewed in order to provide researchers who want to build their own decision-making models, with the necessary knowledge of both fields. The review makes clear that the complex interactions in and competition between the logistics chains and their actors coming together in ports have significant impacts on port capacity. Uncertainty is also caused by uncertain international trade flows and changes in legislation following new technologies and environmental impacts. An analysis of the components of some general RO models shows how the options of flexible output, investment size and timing are valued by RO models in a setting with demand uncertainty. Moreover, the review presents researchers with insights in how to deal with cooperative and competitive interactions in the chain, time to build, cyclical markets and legislation changes. It also shows how to value the expansion and the phased investment options. The new insights resulting from this review are subsequently combined in a framework that serves as a guideline to build RO models for port capacity investments. Finally, an exemplifying application of the framework is used to build an actual port capacity investment decision model.     

Prospect Theory for joint time and money consequences in risk and ambiguity

Transport users face complex decisions. Not only are the consequences of their choices uncertain, but they generally involve several attributes, such as time and money. Time-money tradeoffs have been studied in depth in transport economics, and research is now paying increasing attention to the role of uncertainty and information in transport decisions. This paper aims to measure the impact of uncertainty and information on multi-attribute decisions using Prospect Theory. In doing so, the study makes two contributions to transportation literature: one methodological and the other empirical. First, we propose a fast and tractable method for measuring Prospect Theory parameters that capture attitudes towards probabilities (probability weighting function) and attitudes towards losses (loss aversion). The elicitation method does not require the elicitation of the utility function. This makes it particularly suitable in complex multi-attribute decisions where the shape of the utility function is unknown. Second, we present the results of an experiment that uses the proposed method to measure, at the individual level, probability weighting in decisions involving joint time and money consequences in two decision contexts: risk (where probabilities are given) and ambiguity (where the probability distribution is unknown). An experimental setup that exposes subjects to real gains and losses for money and time has been built for this purpose. We observe inverse S-shaped probability weighting and loss aversion for risk. Probability weighting is even more pronounced in ambiguity, where subjects do not have precise information about the probability distribution. We explain how these results and the analysis of ambiguity attitudes in general can offer a better understanding of travelers’ route or transport mode choices.     

A renaissance in understanding technology dynamics? The emerging concept of transition management in transportation

Abstract

For the last five years the technology factor (by which is meant both process and product innovation) has received renewed attention in the transport sector as society is confronted with new challenges. This leads to a call for change and transitions. Technology is considered as a potential answer to new needs and new problems, like the reduction of CO₂ and the supply of alternative energy. It is important that there is a theoretical basis for the way of thinking on innovation and diffusion when it comes to technology dynamics. This paper, based on a literature study, addresses the question to what extent the theory of transition management can be considered as a new application of technology dynamics. The theory of technological innovations in the broad sense is analysed and applied to the transport sector.     

An integrated assessment of alternative land-based passenger transport policies: A case study in Tenerife

Over recent decades, there have been numerous cases of land-based transport policies that have lacked clear and coherent strategies. This has not only hampered the resolution of issues like road congestion, but has also created new ones (e.g. strong social opposition to new train infrastructures). The absence of such strategies highlights the need for long-term transport policies with a wider vision of the issues, since land-based transport cannot be considered from just a technical perspective.The main objective of this article is to implement a participatory integrated approach to facilitate the understanding of land-based passenger transport governance issues on Tenerife, in the Canary Islands. Relevant policy issues and alternatives are identified by the stakeholders involved. The inclusion of stakeholders in the assessment process is crucial to frame transport governance issues appropriately and to define and assess plausible policy alternatives. This assessment process even included a final step of validation of the results by stakeholders to foster discussion among them about transport issues and policy alternatives.Finally, due to the obstructive role played by some stakeholders in influencing past transport policies, an analysis of possible coalitions among stakeholders is also discussed.     

Capturing tour mode and activity choice interdependencies: A co-evolutionary logit modelling approach

It is generally assumed that the choice of transport mode and the choice of including intermediate activities on a work tour are interrelated, but little is known about the nature of the causal relationship. To shed light on this, this paper addresses the question of whether transport mode choice is dependent on the activity choice or vice-versa. A new methodology, referred to as the co-evolutionary approach, is combined with a set of MNL models, one for each choice facet involved, to derive an indication of the order of decisions on an individual level. The models are estimated based on the work tours of a large sample of individuals in the Netherlands. The results suggest that there is substantial variation in the order of the transport mode and activity decisions. However, in the majority of cases the activity decision is made before the mode decision, suggesting that the transport mode and, in particular, the choice between car and public transport is most often ‘adjusted’ to the choice of trip chaining rather than the other way round.     

Uncertainty in the context of highway appraisal

Transport planning is based on traffic forecasts which are subject to great uncertainties. These uncertainties have generally been ignored or, at least, not explicitly included in the planning process. This paper describes the principles behind the estimation of the uncertainty (or range of error) of the forecasts of a traffic model and discusses the means by which this information can be absorbed into the decision-making in transport planning projects. These principles have been applied to the appraisal of a British highway project and throughout the paper reference is made to this project in order to illustrate the results of the practical application of an explicit treatment of uncertainty. It is believed that this approach can and should be developed for application in most areas of transport planning, leading inevitably to an improvement in the quality of the decisions taken.     

Guidance for transport planning and policymaking in the face of an uncertain future

Uncertainty of outcome is widely recognised as a concern facing decision-makers and their advisors. In a number of spheres of policy, it appears uncertainty has intensified in the face of globalisation, economic instability, climate change, technological innovation and changing consumer preferences. How can planners and policymakers plan for an uncertain future? There is growing interest in, and use of, techniques that can help decision-making processes where deep uncertainty is involved. This paper is based upon one of the most recent international examples of a foresight exercise employed to examine uncertainty – specifically that which concerns uncertainty over the nature and extent of future demand for car travel. The principal focus of the paper is on the insights and guidance this examination of uncertainty brings forth for transport planning and policymaking. To accommodate deep uncertainty requires a flexible and open approach in terms of how policy and investment possibilities are formulated and judged. The paper argues for a focus upon the Triple Access System of spatial proximity, physical mobility and digital connectivity as a framework for policy and investment decisions that can harness flexibility and resilience. Uncertainty becomes an opportunity for decision-makers with the realisation that they are shaping the future rather than (only) responding to a predicted future. The paper outlines two forms of policymaking pathway: regime-compliant (in which adherence to trends and the nature of the world we have known pushes policy) and regime-testing (in which the nature of the world as we have known it is brought into question and vision pulls policy decisions). Stronger orientation towards regime-testing to assist in managing an uncertain future is advocated.     

Heavy-duty trucking and the energy efficiency paradox: Evidence from focus groups and interviews

Theory suggests that profit maximizing firms have an incentive to incorporate cost-effective technologies into their products. However, simple net present value calculations comparing upfront costs of fuel-saving technologies to future savings suggest this is not always the case. This puzzle is commonly referred to as the “energy efficiency paradox.” A growing number of empirical studies examine why households may under-invest in energy efficiency. Fewer studies examine similar undervaluation by businesses. We explore investment decisions within the heavy-duty trucking sector for fuel-saving technologies via focus groups and interviews to gain insight into what factors might explain apparent underinvestment in fuel-saving technologies. We find some evidence that market failures related to lack of information about technology performance and network externalities contribute to slow adoption of some technologies. However, information about new technologies for tractors seems to generate limited spillovers. There is also some evidence of split incentives between owners and drivers, though companies have invested in a variety of technologies and approaches in an attempt to address these effects. Other factors important in trucking investment decisions that are not classic market failures include tradeoffs between fuel economy and other valued truck attributes, as well as uncertainty and risk associated with new technologies if decision-makers are loss averse.     

Exploring ‘weak signals’' as potential challenges in transport: an inventory of potential future technology developments

This article assesses the most likely technological developments in transport, not only by investigating current innovations but also by observing different approaches to confronting future developments. The article discusses technology forecasting and the meaning of environmentally sound technologies; some insights into technology development and the relevance of technological forecasting; the factors that influence technology development in transport; and, in this context, differentiation between exploration, expectation and forecasting. It goes on to identify, from four different perspectives, major developments of strategic relevance for the transport sector that might arise in the longer term. An assessment is made of the consequences of these observations for the implementation of innovations in transport.     

Evaluating sustainable transport strategies with incomplete information for Taipei City

This study uses a hybrid approach to deal with incomplete information in evaluating and prioritizing transport sustainability strategies for Taipei City. Fifteen strategies taken from the three categories of land use planning, shifting modes, and using clean energy are examined. A sustainability compound index covering aspects of society, economy, environment, energy, and finance is constructed to measure transport sustainability.     

Institutional issues in planning for more uncertain futures

Future travel demand has always been difficult to estimate. Recent trends of a slow down or stagnation in traffic growth combined with substantial demographic, economic, and technological shifts further complicate that task. This poses a significant planning challenge given that decision-making is often based on the benefits of infrastructure investments which accrue over periods as long as 60 years. In contrast to the changing ideas around what mobility in the future will look like and the types of demand it may need to service, the practice of forecasting future travel demand remains largely unchanged as do the decision-making processes which flow from this. Alternative approaches to thinking about futures such as scenario planning exist but have had more limited deployment in the transport sector. This paper explores the institutional issues surrounding the purpose, practice and barriers to changing the approaches of forecasting and decision-making through an exploration of the state of practice in the UK drawing on interviews with 23 practitioners. Drawing on Hall’s work on policy change, the research finds that there is a strong policy paradigm built around the relationships between transport investment and traffic growth. This has strengthened since the recession with an increased focus on the relationship between transport and job creation. The forecasting approaches in use today are an important part of a complex decision-making apparatus reflective of specialized policy arenas like transport. Challenges in acknowledging, representing and communicating uncertainty are identified leaving a growing tension between planning visions and planning practice. We conclude by reflecting on events which may stimulate a broader reframing of how we plan for transport futures whilst embracing key uncertainties.

     

The impact of extreme weather conditions on long distance travel behaviour

This paper examines traveller attitudes and responses towards disruption from weather and natural events. An internet-based travel behaviour survey was conducted with more than 2000 respondents in London and Glasgow. Of these respondents, 740 reported information on over 1000 long distance trips affected by extreme weather and natural events over the previous three years. Results show respondents are generally cautious towards travelling during extreme weather events. For a slight majority in the case of air and public transport, and a greater one in the case of car, travellers did not considerably alter their travel plan following the disruption. This was explained not only by less disruptive weather conditions (with heavy snow and volcanic ash being the most disruptive) and impact, but also by the relative importance of their trips. Differences between transport modes were not substantial. Business trips sometimes appeared to give travellers more flexibility, some other times not. Origin and destination did have an impact on reaction, as well as the presence of children whilst travelling. Mixed results were obtained about socio-economic and attitudinal variables. Age in particular did not appear to have a significant effect. Whilst most respondents did acknowledge no external influence in their decision, results showed an important contribution of transport organisation staff, as well as home and mobile internet technology. A limited but still considerable number of respondents indicated their closest friends/relatives as the main influence of their decisions. The results will help planners deploy strategies to mitigate the negative effects of weather related disruptions.     

Automated vehicles: exploring possible consequences of government (non)intervention for congestion and accessibility

ABSTRACT

Academic research on automated vehicles (AVs) has to date been dominated by the fields of engineering and computer science. Questions of how this potentially transformative technology should be governed remain under-researched and tend to concentrate on governing the technology’s early development. We respond in this paper by exploring the possible longer-term effect of government (lack of) intervention.

The paper tests the hypothesis that a “laissez-faire” governance approach is likely to produce less desirable outcomes in a scenario of mass uptake of AVs than would a well-planned set of government interventions. This is done using two prominent themes in transport policy – traffic flow and accessibility – in a scenario of high market penetration of Level-5 automated vehicles in capitalist market economies. The evidence used is drawn from a literature review and from the findings of a set of workshops with stakeholders.

We suggest that a laissez-faire approach will lead to an increase in traffic volume as a result of a growing population of “drivers” and a probable increase in kilometres driven per passenger. At the same time, the hoped-for increases in network efficiency commonly claimed are not guaranteed to come about without appropriate government intervention. The likely consequence is an increase in congestion. And, with respect to accessibility, it is likely that the benefits of AVs will be enjoyed by wealthier individuals and that the wider impacts of AV use (including sprawl) may lead to a deterioration in accessibility for those who depend on walking, cycling or collective transport.

We consider the range of possible government intervention in five categories: Planning/land-use; Regulation/policy; Infrastructure/technology; Service provision; and Economic instruments. For each category, we set out a series of interventions that might be used by governments (at city, region or state level) to manage congestion or protect accessibility in the AV scenario described. Many of these (e.g. road pricing) are already part of the policy mix but some (e.g. ban empty running of AVs) would be new. We find that all interventions applicable to the management of traffic flow would also be expected to contribute to the management of accessibility; we define a small number of additional interventions aimed at protecting the accessibility of priority groups.

Our general finding is that the adoption of a package of these interventions could be expected to lead to better performance against generic traffic-flow and accessibility objectives than would a laissez-faire approach, though questions of extent of application remain.

In our conclusions, we contrast laissez-faire with both anticipatory governance and “precautionary” governance and acknowledge the political difficulty associated with acting in the context of uncertainty. We point out that AVs do not represent the first emerging technology to offer both opportunities and risks and challenge governments at all levels to acknowledge the extent of their potential influence and, in particular, to examine methodically the options available to them and the potential consequences of pursuing them.     

Personal security as a transport issue: a state‐of‐the‐art review

The possibility of experiencing attack, assault, violence, robbery, harassment or other anti‐social behaviour has become an important influence on traveller decision‐making. Fear and apprehension about personal security can affect all aspects of travel choice (e.g. choice of route, mode, time of journey, etc.), including whether to travel at all. Indeed, in some locations an informal curfew is reported to operate. However, both the degree and widespread extent of such fears indicate that unacceptable constraints on personal liberty do exist in many locations.

This paper firstly reviews the extent and nature of the problem considering recorded crime statistics, reported levels of fear and apprehension when using transport facilities and subsequent modifications to travel behaviour. Secondly, a range of possible responses by transport operators, policing agencies and national and local government are examined under four broad headings: policing and staffing; situational crime prevention; social crime prevention; and the level and quality of transport service provision.

It is concluded that personal security considerations need to be explicitly incorporated into decisions concerning the design, planning, operation and management of transport systems. It is also important that institutional structures exist to permit the issue both to be recognized and tackled.     

The Gothenburg congestion charge. Effects,design and politics

This paper summarizes the traffic effects of the Gothenburg congestion charges introduced in 2013. The system is similar to the system introduced in Stockholm in 2006; both are designed as time-of-day dependent cordon pricing systems. We find that many effects and adaptation strategies are similar to those found in Stockholm, indicating a high transferability between smaller and larger cities with substantial differences in public transport use. However, there are also important differences regarding some of the effects, the accuracy of the model forecasts and public support arising from different topologies, public transport use, congestion levels and main objectives communicated to the public. Finally, the Gothenburg case suggests that whether congestion charges are introduced or not depends on the support among the political parties, and that this is determined primarily by the prevailing institutional setting and power over revenues, and to a lower extent by the public support, and benefits from congestion reduction.