United States Department of Transportation
i
Examining the value of travel time reliability for freight transportation to support freight planning and decision-making.
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2016-12-01
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[PDF-14.55 MB]
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Abstract:This report presents the findings of a valuation study recently conducted in Florida to quantify the
freight users’ willingness to pay (WTP) for the improvement of transportation-related attributes,
particularly reliability. A stated preference (SP) survey was developed and administered between
January and May 2016. The survey collected responses from 150 shippers, carriers, and
forwarders. After rigorous data checking and validation, econometric models, including mixed and
multinomial logit models, were developed to estimate the users’ WTP for the improvement of
transportation time and reliability. Preference heterogeneity in WTP was also explored by
commodity group, product type, and various other shipment characteristics, including shipping
distance and weight.
Model results indicated that the value of reliability (VOR) values ranged from $17.00 to $177.00
per shipment-hour and $1.38 to $10.20 per ton-hour, while the value of time (VOT) values ranged
from $12.00 to $277.00 per shipment-hour and $0.50 to $23.00 per ton-hour among the user
groups. Carriers were found with the lowest WTP compared to other freight users. The results
showed large variations in WTP values when user heterogeneity sources were considered. This
study contributes to the literature by providing empirical evidence in quantifying VOR for freight
transportation and the impacts of user heterogeneity on the valuation of reliability. The study
results will help advance the understanding of the impacts of the performance of transportation
systems on the freight industry. The report also provided a brief discussion on the approaches to
incorporating VOR in the benefit-cost analysis (BCA) for project evaluation and accommodating
the effect of unreliability into demand models.
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