In this paper we review the theoretical and empirical literature on the cost structure of the provision of intercity highway transportation and specify and estimate our own cost functions. We develop a full cost model which identifies the key cost components and then estimate costs component by component: user costs, infrastructure costs, time and congestion costs, noise costs, accident costs, and pollution costs. The total long run average cost is $0.34 per vehicle km traveled. The single largest cost category is freeflow travel time. While the marginal cost of infrastructure is higher than its average cost, indicating the new construction is increasingly expendsive, the marginal cost of driving (user fixed and variable costs) is less than the average cost, indicating that by increasing travel the user can spread his fixed cost of a vehicle over more trips without penalty.
|Original language||English (US)|
|Number of pages||17|
|Journal||Transportation Research Part D: Transport and Environment|
|State||Published - Jul 1998|
Bibliographical noteFunding Information:
The authors gratefully acknowledge the contribution of Adib Kanafani, a co-author of the larger report from which much of this paper is drawn. The authors also thank three anonymous reviewers for their helpful comments. This research was funded by the California High Speed Rail Commission and California Department of Transportation as part of a study on The Full Cost of Intercity Transportation: An Intermodal Comparison (UCB-ITS-RR-96-3). The results and opinions presented herein reflect the work of the authors, and not the funders.