Non-linearity of utility function and value of travel time savings: empirical analysis of inter-regional non-business travel mode choice of Japan

The willingness to pay (WTP) for travel time saving is called as the Value of Travel Time Saving (VTTS) and it is widely used for the economic evaluation of transport investment. Although the constant values are often used in practical transport planning, the constancy of the VTTS is derived simply from an assumption of the linear utility function. When using the non-linear utility function, the non-constant VTTS with respect to travel time can be derived. A time allocation model based on DeSerpa (1971) was formulated. The model assumes an individual gains the utility from the leisure time, the travel time and the consumption of a composite good under the constraints of available time and budget with a constraint of minimum travel time. In considering the tourism behavior on a non-work day, it is assumed that the work time is given and fixed. Next, the VTTS from the model is analyzed. Then, the indirect utility function under the condition of discrete choice of travel mode is derived. For the covering abstract see ITRD E135582.