In Part 1 of this blog series, we explored how Activity-Based Models (ABM) and trip-based models could be used to assess the impact of new toll lanes on SR 167 in Seattle, Washington, and reinforced that an understanding of economics – specifically the value of time and money – is important to using them to analyze, justify, and communicate project benefits.

This post expands on those concepts by integrating elasticity data to gauge how price changes may affect traveler behavior on SR 167 under the previously examined road pricing scenario. Price elasticity measures how changes in price, such as a new toll, influences travel demand for a thing, in this case a travel corridor. In congestion pricing, both the monetary and travel time costs change, as pricing aims to reduce travel time and improve reliability. The price elasticity of the SR 167 corridor users can offer additional insights into modeled results, revealing the cost increase that may be required to achieve the observed travel reduction in each model.  

Additional research from Robert Bain suggests that typical traffic volume elasticity to tolls is between -0.03 to -0.5, and is influenced by factors such as alternative routes, traffic congestion, and ease of access to the tolling system. Ease of access refers to people unfamiliar with or lacking a desire to learn or acquire the technology to engage with the tolling system.[3] In this case, using a simple calculation, the price elasticity of SR 99 was approximately-0.2 (indicating a 2% reduction in vehicle trips for every 10% increase in price).[4]

SR 99 has an abundance of alternative routes and transit options serving downtown Seattle, compared to limited alternate options for travelers using the SR 167 corridor. Therefore, the price elasticity of SR 167 corridor travelers is lower than that of SR 99 corridor travelers, and likely approaches -0.1. This means that to achieve the results observed in the ABM from our first post in this series, costs would need to increase 150% if one were to be informed solely by the ABM, compared to a 250% cost increase if one were to be informed solely by the trip-based model results. That’s a pretty big difference, where knowledge of which model might be best suited for the task at hand, as well as how price elasticities work, can help steer you in the right direction.  

Taking a step back, understanding these economic drivers of travel behavior is crucial for decision–makers and can guide responses to community concerns about the introduction or expansion of tolls. For instance, introducing new transit options along SR 167 could provide alternatives to driving and connect Equity Priority Areas (EPAs) to key employment centers. Outreach efforts could ensure all travelers understand and can adapt to the Express Toll Lanes (ETLs) and how dynamic pricing could affect their travel times and wallets.    

Thus, an understanding of economics is indispensable to understanding costs, benefits, and trade-offs in modeled scenarios. Price elasticity not only reveals traveler responses to price changes but also highlights the importance of project improvements like transit options and effective outreach programs. This understanding, coupled with understanding community goals and values, is essential for effective decision-making in a world that requires making the best use of our resources.