A Route Choice Experiment Involving Monetary Payouts and Actual Waiting Times
This paper studies the response of subjects to monetary and direct time costs in an experimental setting using a Pigou-Knight-Downs framework in which subjects choose between a short direct route that becomes increasingly congested as more people travel on it and a more indirect route that does not become congested. This experimental design yields three important new insights. First, some subjects prefer monetary costs, while others prefer time costs. Second, the introduction of subject heterogeneity results in different value of time preferences between subject groups. Finally, there is evidence that subjects from lower socioeconomic families who are currently employed while school (the subject pool is almost entirely comprised of UCSB students) travel the congested route more often when actual waiting time is involved.
Transportation Conference, Banff, Alberta, CANADA 2006