Title

Transit price elasticities and cross-elasticities

Authors

Todd Litman

Document Type

Discussion Paper

Publication Date

8-2007

Subject Area

ridership - elasticity

Abstract

This paper summarises price elasticities and cross elasticities for use in public transit planning. It describes how elasticities are used, and summarizes previous research on transit elasticities. Commonly used transit elasticity values are largely based on studies of short and medium run impacts performed decades ago when real incomes were lower and a larger portion of the population was transit dependent. As a result, they tend to be lower than appropriate to model long-run impacts. Analysis based on these elasticity values tends to understate the potential of transit fare reductions and service improvements to reduce problems such as traffic congestion and vehicle pollution, land understate the long-term negative impacts that fare increases and service cuts will have on transit ridership, transit revenue, traffic congestion and pollution emissions.