Option Value of Public Transport: Methodology for Measurement and Case Study for Regional Rail Links in the Netherlands

Abstract

Abstract Transport option values can be interpreted in terms of a risk premium that individuals with uncertain demand are willing to pay over and above their expected user benefit for the continued availability of a transport facility. These values represent a benefit category not included in conventional transport appraisal. This paper describes a methodology for measuring the option value of public transport services, and its application to two regional railway links in the Netherlands. From an Internet‐based survey examining the value of regional rail services to residents, option values were concluded to be a potentially relevant benefit category in public transport policy appraisal. This survey included three different stated choice experiments to separate the willingness‐to‐pay for use, option use and non‐use. Significant option values could be obtained from the stated choice experiments for both regional railway links.