[sustran] Economic value of urban transport system

eric.britton at ecoplan.org eric.britton at ecoplan.org
Tue Jan 25 18:17:32 JST 2000


Dear Colleagues,

I have received a number of interesting and helpful messages on this topic
over the last days, and they, plus a little head scratching here, have led
me to begin to think about something long the lines of a back of the
envelope model/construct that would be 100% (or close to it) unscientific
and still maybe of some use.  Why am I driven to such ends? Well, cause I
really think that it could be useful to have a better feel for the
importance of the sector in ballpark economic terms, so that we can then
begin to show the value of alternative ways of rejiggering any given city
transport systems.

Let me start the drill here and then go into hiding as the barbs fly:

Goal: Come up with some ballpark figures for the economic value if the urban
transportation system for some mythic but hopefully recognizable city.

1. Let's assume a city of one million people, all of whom enter and use the
local transport system each day, incur direct and impose indirect costs, and
who for the sake of argument are divided into two separate but equal
classes.
2. Half of these people are car owner/drivers, the other half travel by the
city's public transit system (this being one of those nice modern American
cities with no sidewalks or provision for cyclist of pedestrians). The
system does not permit cross-dressing (i.e., if you have a car you go by car
and that's it, and v.v.)
3. Cars owners - all 500k of them - have total daily average costs of
$20/each (i.e., about &7k/year per vehicle?). This means that their total
direct out of pocket is on the order of $10 million/day.
4. The 500 public transit uses incur on the order of $5/day of costs, for a
total of $2.5 million there.
5. Meaning that the out of pocket cost to the individual citizens for our
fictive city's (SimCity?) movement system is on the order of $12 million a
day, 4/5ths of which paid by the auto folks (hmmm.)
6. Now let's take a stab at the indirect costs, starting with an easy one
(easy because all it takes is one whooping assumption), namely the cost of
their time in transit. Following the old and pretty dodgy practices of the
profession, we can for the moment value the time of the transit uses at
something on the order of the minimum wage (call it $6/hour), with the value
of the car people at twice that.  This gives us a total travel time bill on
the order of another $10 million.
7. (Does this seem as if we are in any sort of ballpark at all on this one?)
8. Now externalities, and here I am gong to ask for a bit of help from the
group. In this first stab, I am going to assume that the external costs of
the driver group (and here by the way and in time I want to include their
not so efficient use of valuable urban real estate) is 5x that of the public
transit users - but for today and lacking better, I am going to set the
first-cut bill at exactly the same as their out of pocket in each case.

Where has this got us with our first awful cut?

* Direct out of pocket daily cost to city's million citizens - ca. $12
million
* Value of their time in transit - ca. $10 million
* External costs - ca. $12 million

For a total on order of $35 million dollars each day for the city and its
citizens... which if we push out for an annual figure has us on the order of
$10 billion dollars a year.  That for a single medium sized city.

Three questions for those of you who have worked your way through this mess:

1. Is the basic question with which we started a valid and eventually useful
one?
2. Can the above be patched up to have some usefulness?
3. Do you have any ideas as to what we might do next if we had some
reasonable estimates along these lines?

Have a nice day.

eric britton



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