‘Lexus lanes’ and the price of saving time | Marketplace

I was interviewed on Marketplace (by American Public Media) about ‘Lexus lanes’ and the price of saving time (this is drawn from the same interview as last week’s article).

Part of the problem appears to be a phenomenon documented on Minnesota’s MnPASS system, after which Florida’s I-95 Express plan is modeled. Engineers found that, up to a point, drivers are actually drawn to higher tolls.

“And that’s surprising,” said David Levinson a professor of civil engineering at University of Minnesota and a study author. “Our expectation was that when we raised the price, that fewer people would consume the good … which is what you typically find.”

He says you don’t normally think about driving on high-occupancy toll lanes as a prestige good, where people perceive more value as the price goes up.

On the other hand, Levinson says, maybe there is a real value. “So if you’re a ‘type-A’ person you might get some sort of psychological benefit from passing 20 other cars on your way to work. Even if by passing 20 cars you’ve only saved yourself a minute or two, you’re ahead in the race, so as a positional good you think it’s better.”

And for the record, express lanes may or may not be “better” as the price goes up. Dynamic tolling changes to ensure free-flowing traffic in the express lanes — it has nothing to do with what’s going on in the not-so-express lanes.

The paper is here: HOT or Not: Driver Elasticity to Price on the MnPASS HOT Lanes.

One thought on “‘Lexus lanes’ and the price of saving time | Marketplace”

  1. My theory is that folks are using the toll amount as an indicator of traffic congestion. While driving, they cannot easilty monitor traffic conditions. The radio is helpful, but updates may come on a 5 or 10 minute cycle. So, the best indicator of a collision or congestion is an increase in the HOT lane rate.

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