Using prospect theory to investigate the low marginal value of travel time for small time changes
2012 (English)In: Transportation Research Part B: Methodological, ISSN 0191-2615, Vol. 46, no 8, 917-932 p.Article in journal (Refereed) Published
A common finding in stated preference studies that measure the value of travel time (VTT) is that the measured VTT increases with the size of the time change considered, in conflict with standard neoclassical economic theory. We present a new test of a possible explanation for the phenomenon that builds on the diminishing or constant sensitivity of the value functions in prospect theory. We use stated preference data with trade-offs between travel time and money that provide separate identification of the degrees of diminishing sensitivity for time and money gains and losses. This enables us to test and potentially falsify the prospect theory explanation. We conclude that prospect theory remains a potential explanation of the phenomenon.
Place, publisher, year, edition, pages
2012. Vol. 46, no 8, 917-932 p.
Transport Systems and Logistics
IdentifiersURN: urn:nbn:se:kth:diva-152109DOI: 10.1016/j.trb.2012.04.001ISI: 000309439800001ScopusID: 2-s2.0-84864473985OAI: oai:DiVA.org:kth-152109DiVA: diva2:749591
QC 201409242014-09-242014-09-232014-09-24Bibliographically approved