Estimating Price and Service Elasticity of Urban Transportation Demand with Stated Preference Technique: Case in Korea

Price and service elasticities of passenger car travel are estimated using stated preference and sample enumeration methodology. Moreover, the effects of hypothetical travel demand management policies are analyzed by changes on modal share using the elasticity estimates. The elasticity of passenger car travel with fuel price is estimated to be within the range of −0.078 to −0.171. The parameter estimate of the fare variable is estimated to be statistically insignificant in every subgroup of car users. This finding suggests that fare policies are relatively ineffective for increasing transit modal shares in Korea. Meanwhile, car users' responsiveness to changes in parking costs is estimated to be much higher than for fuel cost. This suggests that parking regulations or pricing policies may be effective in reducing travel by passenger car. The elasticity with in-vehicle time, which is a key attribute of public transport amenities, is estimated to be particularly high, implying that policy measures such as introducing express buses or express urban trains could be effective in reducing passenger car travel. The demand elasticity of service levels of mass transit represented by the degree-of-crowdedness proxy turns out to be very high. Reducing crowdedness in public transit can be very effective in attracting more passengers, or at least in retaining current patronage.