Measurement of the Fatigue Cost of Commuting without Making Specific Assumptions about the Utility Function

Author Name HATTA Tatsuo  (Faculty Fellow, RIETI / Professor, Division of International Studies, International Christian University) /YAMAGA Hisaki  (University of Tsukuba)
Creation Date/NO. March 2006 06-J-011
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The boarding of a congested train by one passenger has the external diseconomy effect of increasing the fatigue of other passengers. In this paper we employ a method in which the conversion of this external diseconomy effect into monetary terms is not dependent on specifying the utility function.

Yamaga and Hatta (2000) converted the time and fatigue costs borne by commuters living along the Chuo Line of Japan Railways (JR) into monetary terms. That is, by postulating that a certain period of time (rest period) is necessary for a commuter to recover from the fatigue that arises as a result of commuting on a congested railway, the non-monetary cost represented by fatigue was converted into time. The commuting time, including the fatigue, was then incorporated into a specified utility function, and by estimating the rent functions (hedonic price functions) derived from that utility function by using rent data for rental apartments located along the JR Chuo Line, all the parameters of the utility function incorporating the variables indicating fatigue were estimated. Yamaga and Hatta (2000) specified a Cobb-Douglas utility function to measure the fatigue cost of commuting.

The framework of the analysis in this paper is a development of Yamaga and Hatta's earlier study (2000). This study measured the rent functions, which occupy an important place in the analysis, by means of logarithmic approximation, and the rent functions obtained in that way were partially differentiated to measure the fatigue cost of increased congestion.

Since no utility functions were specified, fatigue costs were measured corresponding to general utility functions. Using these measurement results it was possible to find the external diseconomies imposed on a single commuter in each segment of train line. As a result, we were able to conclude that, on the JR Chuo Line at the height of the rush hour, it is necessary to fix fares at 0.7-2.94 times the current commuter pass fare.