The Value of Time in Urban Transportation Policy

Abstract

The value of time is the maximum price an individual is willing to pay for an extra unit of free time. This economic time value is widely used to assess the effects of and investments in transport infrastructure. In Russia, however, the value of time is not used in practice. In the present work, the author estimates this indicator for the first time using Russian data. The indicator determines the value of time for regular business trips around Moscow. Based on empirical findings from foreign studies, the author identifies factors that potentially affect the value of the indicator. In addition to travel time and cost, these include individual income, distance traveled, and the type of vehicle used (private or public transport). A questionnaire using the stated preference approach and an ordered logistic regression are used in the analysis. The results show that the maximum amount the average worker is willing to pay for one minute saved on a trip is 8.25 rubles (495 rubles per hour). Further research in this direction could improve methodology and conduct regular national studies on the value of time. This will make a significant contribution to the study of transport behavior and will increase the efficiency of the country's transport system.