Accessibility and Uncertainty: the Option Value of Public Transport

Abstract

Are there option values of public transport services? A few studies have tried to answer this question through various stated preference methods but the question is so far unanswered. In this paper we set out to present the empirical work that has been done with regard to public transport, and then discuss how option value is linked to accessibility. Accessibility can be seen as the end product of the transport system, and our argument is that option value is a component of accessibility. Therefore, estimations of option value should take into account the change in accessibility that an option mode gives rise to. We present a framework where we discuss the logsum as a potential measure. In addition, we argue that there is a risk premium component of the option value, given that individuals are risk averse, that people might be willing to pay to keep a service from removal.