The Value of Time: Evidence from Auctioned Cab Rides

58 Pages Posted: 8 May 2020

See all articles by Nicholas Buchholz

Nicholas Buchholz

affiliation not provided to SSRN

Laura Doval

Columbia University

Jakub Kastl

Princeton University - Department of Economics; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR)

Filip Matějka

Charles University in Prague - CERGE-EI (Center for Economic Research and Graduate Education - Economics Institute)

Tobias Salz

MIT

Date Written: April 2020

Abstract

We estimate valuations of time using detailed consumer choice data from a large European ride hail platform, where drivers bid on trips and consumers choose between a set of potential rides with different prices and waiting times. We estimate consumer demand as a function of prices and waiting times. While demand is responsive to both, price elasticities are on average four times higher than waiting-time elasticities. We show how these estimates can be mapped into values of time that vary by place, person, and time of day. Regarding variation within a day, the value of time during non-work hours is 16% lower than during work hours. Regarding the spatial dimension, our value of time measures are highly correlated both with real estate prices and urban GPS travel flows. We apply our measures to quantify the opportunity cost of traffic congestion in Prague, which we estimate at $483,000 per day.

Suggested Citation

Buchholz, Nicholas and Doval, Laura and Kastl, Jakub and Matějka, Filip and Salz, Tobias, The Value of Time: Evidence from Auctioned Cab Rides (April 2020). CEPR Discussion Paper No. DP14666, Available at SSRN: https://ssrn.com/abstract=3594298

Nicholas Buchholz (Contact Author)

affiliation not provided to SSRN

Laura Doval

Columbia University ( email )

420 West 118th Street
New York, NY 10027
United States

HOME PAGE: http://www.laura-doval.com

Jakub Kastl

Princeton University - Department of Economics ( email )

Princeton, NJ 08544-1021
United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

Filip Matějka

Charles University in Prague - CERGE-EI (Center for Economic Research and Graduate Education - Economics Institute) ( email )

P.O. Box 882
7 Politickych veznu
Prague 1, 111 21
Czech Republic

HOME PAGE: http://www.cerge-ei.cz

Tobias Salz

MIT ( email )

50 Memorial Dr
Cambridge, MA 02142
United States

HOME PAGE: http://https://economics.mit.edu/faculty/tsalz

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