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Transport user benets calculation with the Rule of a Half for travel
demand models with constraints
Christian Winkler*
Institute of Transport Research, German Aerospace Center (DLR), Rutherfordstrae 2, 12489 Berlin, Germany
a r t i c l e i n f o
a b s t r a c t
Article history:
Available online 21 May 2015
The importance of user benets in transport projects assessments is well-known by transport planners
and economists. Generally they have the greatest impact on the result of cost-benet analysis. It is
common practice to adopt the consumer surplus measure for calculating transport user benets. Normally the well-known Rule of a Half, as a practical approximation for the integral of the demand curve,
is used to determine the change of consumer surplus. Changes in travel demand and consumer surplus
are inuenced by all modeled changing variables, which primarily comprise the generalized costs.
However, travel demand models with multiple constraints additionally contain variable shadow prices,
added to the generalized costs. Such models are often used for travel demand modeling of large-scale
areas. The most discussed and well-known model in the eld of transport modeling is the doubly
constrained gravity model. Beside this model with inelastic constraints, there are also more exible
models with elastic constraints. In this paper we enter into the question of whether applying the Rule of
a Half with regard only to the generalized costs and neglecting the shadow prices is valid in the case of
travel demand models with multiple constraints. For this purpose, a theoretical analysis in this paper
provides a mathematical proof.
2015 Elsevier Ltd. All rights reserved.
JEL classiaction:
C65
D61
R42
Keywords:
Consumer surplus
Rule of a Half
Travel demand model
Multinomial logit model
Constraints
1. Introduction
Investments in the transport sector are hallmarked by a longterm life span and high investment costs. Due to restricted public
nancial resources not all transport projects are realizable and they
have to be economically appraised. For this purpose different
methodical approaches exist. The most important concept is the
cost-benet analysis, which is preferentially used worldwide.
Generally, in transport project appraisals, transport user benets have the most impact. The user benets result from the changes
of user costs like travel time and travel cost between the DoMinimum situation (the most likely transport situation over the
course of the appraisal period if no intervention were to occur) and
the Do-Something situation (the Do-Minimum with transport
intervention). The economic theory e as the theoretical basis of the
cost-benet analysis e provides the concept of the consumer surplus for the calculation of the transport user benets. This measure
can be derived by the mathematical integral of the demand function (see, e.g., Varian, 1992).
The importance of user benets in transport projects assessments is well-known by transport planners and economists. But
the calculation of the exact integral of multiple travel demand
functions is quite challenging. Hence, normally the Rule of a Half,
as a practical approximation of the integral of the demand function,
is used to estimate the change of consumer surplus. For the
approximation of the integral all demand-relevant variables have to
be considered by the Rule of a Half. Generally, in transport project
appraisals, the Rule of a Half is applied only to changes of observed
user costs. This approach is correct for travel demand models
without multiple sets of constraints, because travel demand
changes are inuenced exclusively by changes in (observable) user
costs.
Travel demand modeling of large-scale areas, however, often
employs models dealing with two sets of constraints. The most
discussed and well-known model in the eld of transport modeling
is the doubly constrained gravity model. Beside this model with
inelastic constraints, there are also more exible models with
elastic constraints. For doubly (or more) constrained models
(regardless whether inelastic or elastic) the correctness of using the
Rule of a Half only for observable user costs has not yet been
proven. The question arises from the fact that constrained models
37
Tij f gij ,ai ,bj
X
Omin
Tij Oi Omax
i
i
j
Dmin
j
Tij Dj Dmax
j
9
with Omin
Omax
>
i
i
>
=
>
>
with Dmin
< Dmax
;
j
j
constraints
(1)
with
ai, bj: balancing factors to satisfy the constraints.
f: deterrence function with regard to the generalized costs gij
from zone i to zone j.
Oi: total number of trips originating at zone i.
Dj: total number of trips attracted to zone j.
Tij: number of trips from zone i to zone j.
Thereby the number of trips is calculated taking into account
generalized costs and the two sets of constraints. The constraints
are satised by the balancing factors, which are solved iteratively.
For solving this optimization problem different methods can be
used, e.g. the Furness algorithm (Furness, 1965). The constraints are
calculated in the trip generation a priori, but in contrast to the xed
origin constraints (Omin
Omax
) only minimal and maximal values
i
i
are dened for the destination constraints. In this intermediate
range the resulting number of trips attracted to the different zones
is calculated in the trip distribution. Thus, the number of attracted
trips does not depend only on the number of attractors (e.g.
number of persons) but also on the accessibility of the zones. In
particular, this is important for substitutable trips like shopping.1
There are many different versions of the above-mentioned
deterrence function, although the exponential function has
gained a very high importance and will be applied below. The integrated generalized costs gij are composed by travel time and
travel cost from origin i to destination j and the value of travel time
for monetizing (Goodwin, 1974). Hence, the function can be
written:
f gij eb$gij
(2)
with
cij: travel cost from zone i to zone j.
tij: travel time from zone i to zone j.
b: parameter
vot: value of time.
1
Usually, the minimum number of trips is zero, whereas the maximum number
represents the capacity limit of a specic destination.
38
uij uij ij
(3)
with
uij: utility of an alternative (trip from zone i to zone j).
ij: observable part of utility (deterministic).
u
ij: unobservable part of utility (stochastic).
The chosen distribution of the stochastic part of utility determines different discrete choice models. The MNL model results
from the use of Gumbel distribution and the calculation of the
probabilities of trips from zone i to zone j can be written:
eb$uij
Pij P P b$u
e i0 j0
i0
(4)
j0
(7)
with
with
Tij Pij ,T
(5)
eb$gij qi tj
Tij Pij $T P P
$T
eb$gi0 j0 qi0 tj0
Omin
i
with
i0
j0
Tij Oi Omax
i
:
with Omin
Omax
i
i
Tij Dj Dmax
j
with Dmin
< Dmax
j
j
(8)
Dmin
j
(6)
X
i
2
Furthermore, the antiderivative is known for the MNL model and the exact
integral is dened. See for more information e.g. Williams, 1977 or Small & Rosen,
1981. In the present paper the approximation of the integral with the Rule of a Half
is considered.
39
(9)
j0
With f gij eb$gij , ai eb$qi and bj eb$tj results:
f gij ,ai ,bj
Tij P P
,T
f gi0 j0 ,ai0 ,bj0
i0
(10)
j0
XX
f gij ,ai ,bj :
i
(11)
lnai
b
:
ln
bj
b$tj
bj e /ln bj b$tj /tj
b
(12)
DCS
PP
i
DCSij
:
PP 1 0
, gij gij1 Tij0 Tij1
2
i
j
(13)
with
3
The marked points 0 and 1 stand for the equilibrium in the initial and nal
state. The supply curves, in fact necessary for dening the equilibriums, are omitted
for the sake of clarity.
40
dCS* :
(16)
PA
dCS*
XX
i
DCS*
XX
i
DCS*ij
PP 1 1
, uij u0ij , Tij0 Tij1
2
i
j
PP 1
, gij0 q0i t0j gij1 q1i t1j
, Tij0 Tij1
2
i
j
(14)
DCS* stands for the approximate integral of the doubly constrained MNL model, in which the inuence of shadow prices is
included. However, the desired change in consumer surplus is only
a function of the real quantities of generalized costs (Williams,
1976). So DCS* has to be adjusted for the contribution of the constraints (by shadow prices), since (Winkler, 2011):
DCS*sDCS:
(15)
It now needs clarifying whether the RoH, taking only generalized costs into consideration (and neglecting the shadow prices),
Tij u duij :
(17)
Here, u represents the vector of all alternative specic deterministic utility (negative generalized costs and shadow prices),
since every trip Tij depends on the costs of all alternatives. The
insertion in (16) provides:
DCS*
XX
i
PA
Tij u duij :
(18)
vuij
vuij
vuij
duij
dg
dq
dt :
vgij ij vqi i vtj j
(19)
(20)
DCS
Zu X X
u
Tij
dgij dqi dtj :
(21)
Zg X X
1
DCS
g0
Zq X X
1
Tij dgij
q0
Tij dqi
Zt1 X X
t0
Tij dtj :
(22)
The desired component DCS, which encompasses the change of
consumer surplus due to the change in real costs (generalized
costs), is represented only by the rst term on the right side. In
contrast, the effect of the shadow prices has to be extracted.
Initially, for nding of DCS equation (22) can be expressed by:
Zq X X
1
DCS DCS
Tij dqi
Zt1 X X
t0
Tij dtj :
(23)
DCS DCS
Z X
Oi dqi
PA
Z X
PA
Dj dtj :
(24)
Z X
PA
Z X
PA
Oi dqi
Ztj
dtj :
(27)
t0j
Z X
PA
Dj dtj
X D0j D1j
j
, t1j t0j :
(28)
In this case all required factors are given by the trip distribution.
In order to solve equation (24) we have to simplify equation (14)
rstly:
DCS*
X X1
, gij0 gij1 , Tij0 Tij1
2
i
j
P P1 1
, qi q0i , Tij0 Tij1
:
i
j 2
P P1 1
, tj t0j , Tij0 Tij1
i
j 2
(29)
DCS*
X X1
, gij0 gij1 , Tij0 Tij1
2
i
j
Oi ,
X1
:
P1 1
, qi q0i , O0i O1i
, t1j t0j , D0j D1j
2
i 2
j
(30)
dqi :
(25)
q0i
Oi dqi
Oi , q1i q0i :
The insertion of the solved integrals (26) and (28) as well as the
simplication (30) in equation (24) provide:
DCS
P P1 0
, gij gij1 , Tij0 Tij1
2
i j
(26)
All required factors are available e the Ois from the trip generation and the qis from the trip distribution. So there is no problem
calculating the rst portion of benets.
Zqi
Then the integration of the differentials dqi provides the integration variables qi. Next we insert the bounds of integration and
the solution for the inelastic case is:
PA
X D0j D1j
Z X
Dj dtj
41
This is the normal case for elastic constraints. Changing numbers of trips are
also possible for inelastic constraints, but only for zone-specic changes (between
the initial and nal state) of the trip numbers. This is, in particular, an interesting
point for long-term cases.
X1
P1 1
, qi q0i , O0i O1i
, t1j t0j , D0j D1j
:
2
2
i
j
P
i
X D0 D1
j
j
Oi , q1i q0i
2
j
, t1j t0j
(31)
O1i
X
X1
, q1i q0i , O0i O1i
Oi , q1i q0i :
2
i
i
(32)
Furthermore, it is:
X D0 D1
X1
j
j
, t1j t0j , D0j D1j
2
2
j
, t1j t0j :
(33)
Consequently, the last four terms in equation (31) cancel out. So
then we can see, that the RoH is a correct approximation of the
change of consumer surplus for travel demand models with multiple constraints as well. We have derived the approaches for inelastic
constraints on the total number of originating trips and elastic
42