Costs and Benefits of Transportation

What difficult to measure benefits can transportation systems bring?

Improved access to employment, education, healthcare, and new markets

What quantifiable measures do economists rely on to evaluate the value of a given transportation project/policy?

Construction costs, fuel expenditures, time savings, and increased economic activity

What is capital?

One time deisgn and construction costs

What is an example of capital?

Planning, preliminary engineering, project design, environmental impact analysis, right of way acquisition, construction, equipment purchases

What are operating costs?

Recurring operations, mantinence, and rehabilitation costs

What is an example of operating costs?

Traffic management, crash/weather repair, cleanup, equipment, utilities, resurfacing

What are vehicle costs?

Vehicle ownership and mantinence such as fuel tire replacement insurance

What is a benefit to vehicle costs?

Pavement resurfacing improves road conditions and reduces vehicle wear and mantinence costs

What is travel time?

Lost time and productivity

What is an example of travel time?

Implementation of signal timing coordination on an arterial street enabling faster travel times and less delays

What is travel time reliability?

Variance of schedule uncertainty

What is an example of travel time reliability?

Dynamically priced high occupany/toll lane keeping travel speeds close to free flow speed reducing variability in time

What is safety costs?

Number, severity, and costs of crashes

What is an example of safety costs

Rumble strips reduces number of crashes related to driver fatigue

What are emission costs?

Health and other costs of vehicle produced pollution

What is an example of emission costs?

Fleet conversion from diesel to compressed natural gas

What is noise cost?

Discomfort and property value loss due to traffic noise

What is an example of noise cost?

Construction of a sound wall between a freeway and adjacent neighborhood

What is ecological impacts?

Travels impact on wildlife habitat, water flow, and water quality

What is an example of ecological impacts?

Planned roadway alignment runs through endangered species habitat impeding animal movements

A reduction of cost can be considered what?

A benefit

What are internal costs?

Expenses paid directly by the people who operate or use the system

What are external costs?

Spillover costs that fall on people who arent directly part of the transaction

What do external costs include?

Health impacts of pollution, stress and sleep loss from traffic noise, and traffic congestion

Why is traffic congestion considered an external cost?

It represents a burden that one drivers actions impose on others, slowing down trips and wasting time and fuel

What are the operating costs of automobiles, railroads, airlines, and ships?

Fuel, labor, maintenance, and supplies

What are the capital costs to automobiles?

Vehicle, roadway, traffic signals

What are the capital costs to railroads?

Railcars, tracks, stations, railyards, and signal systems

What are the capital costs to airlines?

Airplanes, airports, and traffic control systems

What are the capital costs to ships?

Ports, ships

What are capital costs in transportation?

Large, fixes, and largely sunk one time investments

What are operating costs?

Ongoing expenses needed to keep those facilities, vehicles, and services running smoothly

When are there no externalities?

When social cost is equal to private cost. Social costs are fully covered by users

Why are taxes not included in social costs?

They are considered financially neutral transfers

What are taxes included in?

Private costs

When are travelers not covering the full social costs?

When social cost is greater than private cost

When social cost is greater than private cost where does the burden fall?

Non users

What are examples of non users carrying the burden for social costs being greater than private costs?

Crash costs, government services, and environmental impacts

How much of private commuting costs do travel time and reliability together account for?

Roughly half

What make up a third of commuting costs?

Vehicle related expenses

How much percent of roadway costs do drivers fund?

25%

How do drivers fund 25% of roadway costs?

Through taxes, including fuel taxes and tolls.

How much percent of parking infrastructure is passed onto users?

Less than 3%

What is the remainder of the costs passed onto?

Other taxpayers and employers

What percent of crash-related costs are paid by drivers themselves?

59%

Who bores the rest of the percent of crash related costs?

Society

What percent of the cost of local air pollution do drivers personally experience?

4.5%

True or False, global costs are entirely absent from private cost accounting

True

What percent of the total social cost of an average commute is external?

29%

The total increase in crash costs for other drivers from one additional mile is how much percent of the cost associated with the drivers own crash risk?

18%

What do actual values vary by?

Location, type of roadway and time of day

Why is understanding external costs critical?

It is used to understand environmental, delay related, and safety impacts of transportation activities

Metrics on the impacts of transportation activities and external costs help transportation planners, engineers and policy makers with what?

Gaining a sense of how important transportation is to economic systems, quality of life, and the long term health and safety of current and future generations

What does optimal decision making in transportation require?

A comprehensive and long term perspective on a variety of project and policy alternatives