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Chapter 11

Auto transportation exhibits almost constant costs, because the ... The first rider costs a lot to transport, but as more riders are added, the average cost per rider declines. ...

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Chapter 11

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    Slide 1:Chapter 11 –Mass Transit

    Slide 3:Commutes broken down further

    Slide 4:Transit riders by income shares

    Slide 5:Efficiency of Transit Modes

    Slide 6:What affects demand for transit Price elasticity - 10% increase in fares decreases ridership by 3.3% (ep=-0.33). Not very elastic overall, but high-income commuters the elasticity is higher…why? -Remember, more available substitutes means higher price elasticity of demand.

    Slide 7:What affects demand for transit Time elasticity - The demand for transit is more responsive to changes in the length of travel time. A 10% increase in the travel time reduces ridership by 3.9% (et=-0.39). Furthermore, the time it takes to get to the stop is -0.71. -”Time is money”…this cost is often more important than the out-of-pocket costs.

    Slide 8:What affects demand for transit Value of time - the average commuter values the time in transit at half their wage. This means that the average commuter would be willing to spend ˝ of their hourly wage to avoid an hour in transit…the value of time spent going between home and the bus stop (or work and the bus stop) is valued at 3 time more or 1.5 times their hourly wage. -For higher wage commuters, the costs are very high when viewed this way.

    Slide 9:Modal Choice and Time Costs

    Slide 10:What improvements could help improve ridership? Location of stops/stations (closer to housing and work centers, lower collection costs) Scheduling (more often, less wait time) Express routes (fewer stops, faster travel) 1 & 3 are working in opposition to each other. Commuter rail has few stops, but high collection costs. Bus has low collection costs, but more frequent stops. BART integrates both of these…buses and other transit gets commuters to rail station, then express to work in SF.

    Slide 11:Modal Costs May Vary Capital costs (rail vs non-rail, rail high) Operating costs (rail high) Pollution costs (bus high) Time costs

    Slide 13:Public Subsidy of Transit

    Slide 14:Why do fares no longer cover costs? In 1960, transit actually made a profit (on average). What happened?! Fares have been kept low to attract riders Wages have gone up for transit workers Sprawl means transit has to cover more ground Transit labor productivity declined…6% more riders since 1960, but twice as many workers. MORE PEAK TRAFFIC…you have to build for peak (like with power generation), so, average costs during non-peak times are higher.

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