The valuation of commuter travel time savings for car drivers: evaluating alternative model specifications

The empirical valuation of travel time savings is a derivative of the ratio of parameter estimates in a discrete choice model. The most common formula tion (multinomial logit) imposes strong restrictions on the profile of the unobserved influences on choice as represented by the random component of a preference function. As we progress our ability to relax these restriction s we open up opportunities to benchmark the values derived from simple (alb eit relatively restrictive) models. In this paper we contrast the values of travel time savings derived from multinomial logit and alternative specifi cations of mixed (or random parameter) logit models. The empirical setting is urban car commuting in six locations in New Zealand. The evidence sugges ts that less restrictive choice model specifications tend to produce higher estimates of values of time savings compared to the multinomial logit mode l; however the degree of under-estimation of multinomial logit remains quit e variable, depending on the context.