May 5, 2017

Avoiding Traffic Congestion Externalities? The Value of Urgency

Time

1:40 p.m. – 3:00 p.m.

Location

1605 Tilia, Room 1103, West Village

Speaker(s)

Antonio Bento, Chair, Department of Policy Analysis and Real Estate, University of Southern California

Abstract

Taking advantage of a program that allows solo-drivers to enter ExpressLanes upon a payment of a toll, we provide the first estimates of commuters’ value of urgency, defined as a discrete amount to avoid failing on-time arrival. We provide evidence that, because commuters are schedule constrained, preferences for urgency explain about 70 percent of drivers’ willingness to pay to access these ExpressLanes. Earlier theoretical models that ignore preferences for urgency fail to fit the data and explain important empirical regularities. While the value of time and value of reliability have been commonly used for infrastructure project evaluation, our results show that the value of urgency is the critical parameter for evaluation of congestible infrastructure projects where pricing is possible.

Biographical Sketch

Antonio M. Bento is a professor at the Sol Price School of Public Policy and the Department of Economics of the University of Southern California. He is also a research associate of the National Bureau of Economic Research (NBER), and a research fellow of the Schwarzenegger Institute for State and Global Policy.

Professor Bento received a BA in Economics from the Nova School of Business and Economics (Portugal) in 1996, and a PhD in Agricultural and Resource Economics (jointly with Economics) from the University of Maryland in 2000. He previously taught at the University of California, Santa Barbara (2000-2004), the University of Maryland (2004-2007), Cornell University (2007-2015), and has been a visiting professor at Stanford University, and a regular consultant to the World Bank.

Professor Bento is an applied microeconomist with a research program in the areas of environmental, energy, urban, and public economics. Most of his work consists of theoretical and empirical assessments of major public policy issues, and his scholarly interests range widely both in topics and methods. For the past few years, Professor Bento has written on topics related to the design of climate change mitigation policies and the interactions of (new) environmental policies with the broader tax system; the effectiveness of policies that promote the expansion of biofuels, renewable energy, and the diffusion of cleaner technologies; causes and remedies of urban sprawl and urban environmental challenges in developed and developing countries; the benefits of major environmental regulations, such as the Clean Air Act and its Amendments; individual responses to real-time pricing; and the distributional impacts of various environmental policies, including federal gasoline taxes. His work has been published in the American Economic Review, the American Economic Journal: Economic Policy, the Review of Economics and Statistics, the Journal of Environmental Economics and Management, the Journal of Urban Economics, the Energy Journal and other scholarly journals and books.

Professor Bento contributed to the New York State Climate Change Action Plan, the New York State Biofuels Roadmap, the U.N. Scientific Committee on Problems of the Environment (SCOPE) Assessment Report on Biofuels, served as a contributing author to the Intergovernmental Panel on Climate Change (IPCC) Fifth Assessment Report, and was recently appointed as a lead author to the International Panel on Social Progress (IPSP).