ON THE SOCIAL VALUATION OF TRAVEL TIME SAVINGS.

Abstract

In this paper we propose a method to compute the social values of users' travel time savings within a cost -benefit framework. It is shown that the resulting values are related to three main factors: the travellers' subjective valuation of time savings, the taxpay- ers' valuation of the money paid, and a value judgement about individual welfare made by the political authorities. As a general result, the method yields social values of time which are group specific, with a single value representing a particular case. The proposed method hopefully puts an end to the old discussion between subjective and equity values of time. It isolates what is really a political decision (the social weight of individual welfare) from what is a technical issue (the measure of subjective valuations). A numerical example illustrates the method.