Elasticities of fuel and traffic demand and the direct rebound effects: An econometric estimation in the case of Norway

We estimate the elasticities of fuel and travel demand with respect to fuel prices and income in the case of Norway. Furthermore, we derive the direct rebound effects that explain the degree to which a fuel price increase is “offset” in the form of greater fuel use and/or travel due to improvements in vehicle fuel efficiency. For this purpose, we use and compare two alternative econometric approaches: the error correction model (ECM) and the dynamic model. Our initial assumption is that one should not be indifferent with respect to the approach used to derive elasticities. The data used are for the period 1980–2011. Our results indicate the following: (1) the dynamic model fits the data better than the ECM model does; (2) the estimated elasticities of fuel demand with respect to price and income are −0.26 and 0.06 in the short run and −0.36 and 0.09 in the long run. For travel demand, the respective elasticities are −0.11 and 0.06 in the short run and −0.24 and 0.13 in the long run, implying inelastic demands for fuel and travel demand; and (3) rebound effects indicate that 0.26% and 0.06% of fuel savings as a result of fuel price increase will be offset in the form of more fuel use in the short run and in the long run, respectively, if fuel efficiency increases by 1%. Our policy recommendations are that policies should not be indifferent to the methods used to derive elasticities. We contend that it is crucial to seriously consider rebound effects in policy making because basic elasticity estimates exaggerate the impact of fuel price increases.     

Estimating a model of dynamic activity generation based on one-day observations: Method and results

In this paper we develop and explore an approach to estimate dynamic models of activity generation on one-day travel-diary data. Dynamic models predict multi-day activity patterns of individuals taking into account dynamic needs as well as day-varying preferences and time-budgets. We formulate an ordered-logit model of dynamic activity-agenda-formation decisions and show how one-day observation probabilities can be derived from the model as a function of the model’s parameters and, with that, how parameters can be estimated using standard loglikelihood estimation. A scale parameter cannot be identified because information on within-person variability is lacking in one-day data. An application of the method to data from a national travel survey illustrates the method. A test on simulated data indicates that, given a pre-set scale, the parameters can be identified and that estimates are robust for a source of heterogeneity not captured in the model. This result indicates that dynamic activity-based models of the kind considered here can be estimated from data that are less costly to collect and that support the large sample sizes typically required for travel-demand modeling. We conclude therefore that the proposed approach opens up a way to develop large-scale dynamic activity-based models of travel demand.     

Bayesian estimation of multinomial probit models of work trip choice

In this paper, we estimate a multinomial probit model of work trip mode choice in Seoul, Korea, using the Bayesian approach with Gibbs sampling. This method constructs a Markov chain Gibbs sampler that can be used to draw directly from the exact posterior distribution and perform finite sample likelihood inference. We estimate direct and cross-elasticities with respect to travel cost and the value of time. Our results show that travel demands are more sensitive to travel time than travel cost. The cross-elasticity results show that the bus has a greater substitute relation to the subway than the auto (and vice versa) and that an increase in the cost of an auto will increase the demand for bus transport more so than that of the subway.     

Estimating flight-level price elasticities using online airline data: A first step toward integrating pricing,demand, and revenue optimization

We estimate flight-level price elasticities using a database of online prices and seat map displays. In contrast to market-level and route-level elasticities reported in the literature, flight-level elasticities can forecast responses in demand due to day-to-day price fluctuations. Knowing how elasticities vary by flight and booking characteristics and in response to competitors’ pricing actions allows airlines to design better promotions. It also allows policy makers the ability to evaluate the impacts of proposed tax increases or time-of-day congestion pricing policies. Our elasticity results show how airlines can design optimal promotions by considering not only which departure dates should be targeted, but also which days of the week customers should be allowed to purchase. Additionally, we show how elasticities can be used by carriers to strategically match a subset of their competitors’ sale fares. Methodologically, we use an approach that corrects for price endogeneity; failure to do so results in biased estimates and incorrect pricing recommendations. Using an instrumental variable approach to address this problem we find a set of valid instruments that can be used in future studies of air travel demand. We conclude by describing how our approach contributes to the literature, by offering an approach to estimate flight-level demand elasticities that the research community needs as an input to more advanced optimization models that integrate demand forecasting, price optimization, and revenue optimization models.     

Hedonic versus homogeneous output specifications of railroad technology: Belgian railroads 1950–1986

The purpose of this paper is twofold. First, using data on Belgian railroad operations, we provide the first application of hedonic output aggregation to the railroad industry. Second, we compare the traditional homogeneous output approach with the use of these hedonic aggregates and carefully evaluate differences in estimates of input substitution possibilities, returns to scale, and productivity growth. It is found that ignoring the role of operating characteristics in cost analyses implies substantial bias in estimates of railroad technology.     

Temporal disaggregation of travel demand for high resolution emissions inventories

The commonly used photochemical air quality model, the Urban Airshed Model (UAM), requires emission estimates with grid-based, hourly resolution. In contrast, travel demand models, used to simulate the travel activity model inputs for the transportation-related emissions estimation, typically only provide traffic volumes for a specific travel period (e.g. the a.m. and p.m. peak periods). A few transportation agencies have developed procedures to allocate period-based travel demand data into hourly emission inventories for regional grid cells. Because there was no theoretical framework for disaggregating period-based volumes to hourly volumes, application of these procedures frequently relied upon a single hypothetical hourly distribution of travel volumes. This study presents a new theoretical modeling framework that integrates traffic count data and travel demand model link volume estimates to derive intra-period hourly volume estimates by trip purpose. We propose a new interpretation of the model coefficients and define hourly allocation factors by trip purpose. These allocation factors can be used to disaggregate the travel demand model ‘period-based’ simulation volumes into hourly resolution, thereby improving grid-based, hourly emission estimates in the UAM.     

Latent temporal preferences: An application to airline travel

An essential element of demand modeling in the airline industry is the representation of time of day demand—the demand for a given itinerary as a function of its departure or arrival times. It is an important datum that drives successful scheduling and fleet decisions. There are two key components to this problem: the distribution of the time of day demand and how preferred travel time influences itinerary choice. This paper focuses on estimating the time of day distribution. Our objective is to estimate it in a manner that is not confounded with air travel supply; is a function of the characteristics of the traveler, the trip, and the market; and accounts for potential measurement errors in self-reported travel time preferences. We employ a stated preference dataset collected by intercepting people who were booking continental US trips via an internet booking service. Respondents reported preferred travel times as well as choices from a hypothetical set of itineraries. We parameterize the time of day distribution as a mixture of normal distributions (due to the strong peaking nature of travel time preferences) and allow the mixing function to vary by individual characteristics and trip attributes. We estimate the time of day distribution and the itinerary choice model jointly in a manner that accounts for measurement error in the self-reported travel time preferences. We find that the mixture of normal distributions fits the time of day distribution well and is behaviorally intuitive. The strongest covariates of travel time preferences are party size and time zone change. The methodology employed to treat self-reported travel time preferences as potentially having error contributes to the broader transportation time of day demand literature, which either assumes that the desired travel times are known with certainty or that they are unknown. We find that the error in self-reported travel time preferences is statistically significant and impacts the inferred time of day demand distribution.     

A complex network perspective for characterizing urban travel demand patterns: graph theoretical analysis of large-scale origin–destination demand networks

Urban travel demand, consisting of thousands or millions of origin–destination trips, can be viewed as a large-scale weighted directed graph. The paper applies a complex network-motivated approach to understand and characterize urban travel demand patterns through analysis of statistical properties of origin–destination demand networks. We compare selected network characteristics of travel demand patterns in two cities, presenting a comparative network-theoretic analysis of Chicago and Melbourne. The proposed approach develops an interdisciplinary and quantitative framework to understand mobility characteristics in urban areas. The paper explores statistical properties of the complex weighted network of urban trips of the selected cities. We show that travel demand networks exhibit similar properties despite their differences in topography and urban structure. Results provide a quantitative characterization of the network structure of origin–destination demand in cities, suggesting that the underlying dynamical processes in travel demand networks are similar and evolved by the distribution of activities and interaction between places in cities.     

Using survival models to estimate bus travel times and associated uncertainties

Transit agencies often provide travelers with point estimates of bus travel times to downstream stops to improve the perceived reliability of bus transit systems. Prediction models that can estimate both point estimates and the level of uncertainty associated with these estimates (e.g., travel time variance) might help to further improve reliability by tempering user expectations. In this paper, accelerated failure time survival models are proposed to provide such simultaneous predictions. Data from a headway-based bus route serving the Pennsylvania State University-University Park campus were used to estimate bus travel times using the proposed survival model and traditional linear regression frameworks for comparison. Overall, the accuracy of point estimates from the two approaches, measured using the root-mean-squared errors (RMSEs) and mean absolute errors (MAEs), was similar. This suggests that both methods predict travel times equally well. However, the survival models were found to more accurately describe the uncertainty associated with the predictions. Furthermore, survival model estimates were found to have smaller uncertainties on average, especially when predicted travel times were small. Tests for transferability over time suggested that the models did not over-fit the dataset and validated the predictive ability of models established with historical data. Overall, the survival model approach appears to be a promising method to predict both expected bus travel times and the uncertainty associated with these travel times.     

Real-time estimation of turning movement proportions from partial counts on urban networks

Modern traffic signal control systems require reliable estimates of turning flows in real time to formulate effective control actions, and accommodate disturbances in traffic demand without deteriorating the system performance. The more accurate the estimation is, the more effective the control plan is. Most of the previous research works assumed that a full set of detector counts is available and employed the least-squares methods to produce unbiased estimates of the turning movement proportions. However, in practice, such a dense detector configuration is expensive to install and maintain. Also, the least-squares estimates are not feasible when the travel time between inflows and outflows is significant, or when intervening traffic conditions change the travel time. This study proposes a nonlinear least-square (NLS) approach and a quasi maximum likelihood (QML) approach to recursively estimate turning movement proportions in a network of intersections where only a partial set of detector counts are available. Using large population approximation technique, a class of nonlinear, discrete-time traffic flow models are transformed into a linear state–space model tractable for on-line applications. The quality of estimates is demonstrated by implementing the proposed algorithms with simulation and real data. As a comparison, the NLS estimator shows less bias but with higher variance than the QML estimator. The QML estimator outperforms the NLS estimator in terms of total mean square error, due to an increase in bias being traded for a decrease in variance.     

Agent-based network transmission model using the properties of macroscopic fundamental diagram

The field of research that has recently come to the fore is the perimeter control, which aims to control traffic demand for a large urban area prior to controlling internal flow inside the area. Such control concept needs to be tested by simulations, hence, it is necessary to develop a model that can appropriately estimate the network-wide flow dynamics. In this paper, agent-based network transmission model (ANTM) is proposed for describing the aggregated flow dynamics over an urban area of multiple large-scale networks. The proposed model is the combination of the cell transmission model (CTM), macroscopic fundamental diagram (MFD), and agent concept. The CTM-based simulation is adopted for the simplicity considering the computation requirements for real-time feasibility. The MFD concept is applied for representing the network properties, and a new approach is taken particularly for estimating network outflow affected by both demand patterns and boundary capacity. The agent concept is applied for representing drivers’ travel behaviors. The model is compared with microscopic simulations and shows reasonable accuracy for large areas. In addition, various travel direction choice behaviors are applicable to this model. Various perimeter control policies are applicable as well, thus, the proposed model can be a useful tool for testing various control methods, in terms of reducing the congestion in urban areas.     

Valuing crowding in public transport: Implications for cost-benefit analysis

This paper investigates the valuation of crowding in public transport trips and its implications in demand estimation and cost-benefit analysis. We use a choice-based stated preference survey where crowding levels are represented by means of specially designed pictures, and use these data to estimate flexible discrete choice models. We assume that the disutility associated with travelling under crowded conditions is proportional to travel time. Our results are consistent with and extend previous findings in the literature: passenger density has a significant effect on the utility of travelling by public transport; in fact, the marginal disutility of travel time in a crowded vehicle (6 standing-passengers/m²) is 2.5 times higher than in a vehicle with available seats. We also compare the effects of different policies for improving bus operations, and the effect of adding crowding valuation in cost-benefit analysis. In doing that, we endogenise the crowding level as the result of the equilibrium between demand and supplied bus capacity. Our results indicate that important benefits may be accrued from policies designed to reduce crowding, and that ignoring crowding effects significantly overestimate the bus travel demand the benefits associated with pure travel time reductions.     

Embedding risk attitude and decision weights in non-linear logit to accommodate time variability in the value of expected travel time savings

In recent years we have seen important extensions of logit models in behavioural research such as incorporation of preference and scale heterogeneity, attribute processing heuristics, and estimation of willingness to pay (WTP) in WTP space. With rare exception, however, a non-linear treatment of the parameter set to allow for behavioural reality, such as embedded risk attitude and perceptual conditioning of occurrence probabilities attached to specific attributes, is absent. This is especially relevant to the recent focus in travel behaviour research on identifying the willingness to pay for reduced travel time variability, which is the source of estimates of the value of trip reliability that has been shown to take on an increasingly important role in project appraisal. This paper incorporates, in a generalised non-linear (in parameters) logit model, alternative functional forms for perceptual conditioning (known as probability weighting) and risk attitude in the utility function to account for travel time variability, and then derives an empirical estimate of the willingness to pay for trip time variability-embedded travel time savings as an alternative to separate estimates of time savings and trip time reliability. We illustrate the richness of the approach using a stated choice data set for commuter choice between unlabelled attribute packages. Statistically significant risk attitude parameters and parameters underlying decision weights are estimated for multinomial logit and mixed multinomial logit models, along with values of expected travel time savings.     

Use of ecological footprinting to explore alternative transport policy scenarios in an Irish city-region

The objective of this paper is to compare the ecological footprint for travel-commuting patterns for the residents of an Irish city-region, that is Limerick city-region, in 1996 and 2002. Scenario building, based on ecological footprint analysis, is used to estimate the impact of different policy choices for 2010. The optimal policy mix for sustainable travel is proposed and consists of a mix of reduced demand through travel demand measures, better spatial planning and technological improvements in fuel economy.     

Using observed traffic volumes to improve fine-grained regional emissions estimation

When translating travel demand model output to photochemical model input, period-based network assignment volumes must be converted to gridded-hourly vehicle emissions. A post-processor, such as the California Direct Travel Impact Model (DTIM2), is frequently used to disaggregate the period-based travel demand assignments to the fine grained spatial and temporal resolution required by the photochemical models. A recent theoretical enhancement proposed refining the temporal and spatial resolutions of travel demand model predictions using observed count data. This method provides a technique for disaggregating the period-based travel demand model assignments (e.g., AM peak, PM peak) into the hourly summaries required by most photochemical model (Lin and Niemeier, 1997). In this study we present a methodological framework for applying the new theory and discuss the results of a large-scale application empirical comparison between the standard and proposed methods for estimating regional mobile emissions in Sacramento, California. The standard method produced slightly higher estimates of daily emissions (about 1%) when compared to the emissions estimated using observed count data. However, the two approaches produced hourly emissions estimates that differed by as much as 15% in some hours.     

Integrating parking behaviour in activity-based travel demand modelling: Investigation of the relationship between parking type choice and activity scheduling process

Traditionally, the parking choice/option is considered to be an important factor in only in the mode choice component of a four-stage travel demand modelling system. However, travel demand modelling has been undergoing a paradigm shift from the traditional trip-based approach to an activity-based approach. The activity-based approach is intended to capture the influences of different policy variables at various stages of activity-travel decision making processes. Parking is a key policy variable that captures land use and transportation interactions in urban areas. It is important that the influences of parking choice on activity scheduling behaviour be identified fully. This paper investigates this issue using a sample data set collected in Montreal, Canada. Parking type choice and activity scheduling decision (start time choice) are modelled jointly in order to identify the effects of parking type choice on activity scheduling behaviour. Empirical investigation gives strong evidence that parking type choice influences activity scheduling process. The empirical findings of this investigation challenge the validity of the traditional conception which considers parking choice as exogenous variable only in the mode choice component of travel demand models.     

Improving estimates of transportation emissions: Modeling hourly truck traffic using period-based car volume data

We estimate hourly truck traffic using period-based car volumes that are usually available from travel demand models. Due to the lack of local or regional data, default vehicle-miles traveled mix by vehicle class in mobile emission inventory models is usually used in transportation emissions inventory estimates. Results from such practice, however, are often far from accurate. Heavy-duty trucks generate orders of magnitudes higher emission rates than light duty vehicles. Vehicle classification data collected from weigh-in-motion stations in California are used to examine the performance of various forms of the method across days of week and geographic areas. We find that the models identified provide satisfactory and statistically robust estimates of truck traffic.     

Effect of providing traffic information estimated by a stochastic network equilibrium model with stochastic demand

To estimate travel times through road networks, in this study, we assume a stochastic demand and formulate a stochastic network equilibrium model whose travel times, flows, and demands are stochastic. This model enables us to examine network reliability under stochastic circumstances and to evaluate the effect of providing traffic information on travel times. For traffic information, we focus on travel time information and propose methods to evaluate the effect of providing that information. To examine the feasibility and validity of the proposed model and methods, we apply them to a simple network and the real road network of Kanazawa, Japan. The results indicate that providing ambulance drivers in Kanazawa with travel time information leads to an average reduction in travel time of approximately three minutes.     

Airline competition and market frequency: A comparison of the s-curve and schedule delay models

We compare two common ways of incorporating service frequency into models of airline competition. One is based on the so called s-curve, in which, all else equal, market shares are determined by frequency shares. The other is based on schedule delay—the time difference between when travelers wish to travel and when flights are available. We develop competition models that differ only with regard to which of the above approaches is used to capture the effect of frequency. The demand side of both models is an approximation of a nested logit model which yields endogenous travel demand by including not traveling in the choice set. We find symmetric competitive equilibrium for both models analytically, and compare their predictions concerning market frequency with empirical evidence. In contrast to the s-curve model, the schedule delay model depicts a more plausible relationship between market share and frequency share and accurately predicts observed patterns of supply side behavior. Moreover, the predictions from both models are largely the same if we employ numerical versions of the model that capture real-world aspects of competition. We also find that, for either model, the relationship between airline frequency and market traffic is the same whether frequency is determined by competitive equilibrium, social optimality, or social optimality with a break-even constraint.     

An aggregate demand model for intercity passenger travel in Sri Lanka

Inspite of the inherent weaknesses in aggregate demand models, they continue to be used in everyday applications, especially in developing countries. The largely data intensive disaggregate model preclude its application in many cases. This paper attempts the formulation and calibration of an aggregate total demand model for estimating inter-district passenger travel by public transport in Sri Lanka. In its process, an investigation is made of the common problems in the aggregate approach while examining possible remedial measures to improve the accuracy and (hence) the usability of the aggregate model. It is argued that commonly used variables and functional forms are inappropriate for making accurate estimates in developing countries. Consequently, the model calibration is shown to incorporate variables representing urbanisation, under-development, transfers, a mode-abstract cost function and intrinsic features. The necessity for functional form for each variable to be based on behavioral assumptions that are tested using the Box-Cox transformation for ensuring the best fit of the data is also observed. Although, the model form was calibrated for Sri Lanka, the model is generalised in order for its applications to other countries as well as, both, inter-district and intercity travel demand estimation.