The Value of Wireless Internet Connection on Trains: Implications for Mode- Choice Models Ipsita Banerjee a, Adib Kanafani b

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1 1 he Vaue of Wireess Inerne Connecion on rains: Impicaions for Mode- Choice Modes Ipsia Banerjee a, Adib Kanafani b a Deparmen of Civi and Environmena Engineering, 116 McLaughin Ha, Universiy of Caifornia, Berkeey, CA Phone: Fax: Emai: ipsia@berkeey.edu b Deparmen of Civi & Environmena Engineering, 112 McLaughin Ha Universiy of Caifornia Berkeey, CA Phone: Fax: Emai: kanafani@berkeey.edu Absrac Depoymen of advanced echnoogies has enabed ireess inerne access for commuers on various ransporaion modes. Such neorked environmens have enabed riders o engage in producive aciviies in ransi. he abiiy o perform aciviies hie raveing, especiay paid ork, may significany affec he vaue of rave ime (VO), ih poenia impacs on mode choice and commue paerns. In his sudy, e deveop a mode of he VO grounded in uiiy heory and aciviy choice anaysis. We use an efficiency facor hich represens he raio of he efficiency of orking on ransi o he efficiency of orking a he orkpace. his efficiency facor is used exensivey in our modes. Inerne connecion is expeced o increase facor efficiency by providing access o rea ime informaion and enhanced communicaion. he mode deveoped is used o expore he effecs on VO of orking in an enhanced neorked environmen hie commuing. he resus sho ha uiiy increases and VO decreases ih increase in he efficiency of ork hie in ransi, as is inuiive. An indirec uiiy funcion has been derived o represen rave on modes ih inerne access. he derivaion permis an eegan inroducion of inerne access as an aribue in uiiy based choice modes. Finay, he proposiion ha inerne access may infuence mode choice is corroboraed by a survey conduced in June 2005 on Capio Corridor rains. Keyords: vaue of rave ime, aciviy choice mode, ireess inerne connecion, indirec uiiy funcion, ransi

2 1. Inroducion Advances in he echnoogy of ireess communicaions, such as ireess fideiy (WiFi) connecions on ransporaion modes have increased he opporuniy for riders o engage in producive aciviies hie in ransi. Wireess inerne connecions have aoed riders o conduc business or connec o ebsies for persona, eisure, and enerainmen purposes. he benefis of ireess inerne access can aso be exended o he operaors. he infrasrucure and inerne access coud be used o improve icke coecion, bunde vaue-added services, and impemen services for improving operaiona efficiencies. he service coud aso be used for improving pubic safey and securiy. Due o is immense use o he riders, ireess inerne service is poised o be inroduced o many rai sysems in he near fuure. According o some indusry esimaes, mos rai sysem riders in Norh America and Europe are expeced o have onboard ireess inerne access in he nex five o en years. Some services are aso offered on a commercia basis as beeen Paris and Brusses on he hays high speed rains (Kanafani, 2005). Whie mosy appicabe o rains, some buses are equipped ih his service oo, as are he Wesern Conra Cosa ransi Auhoriy buses. he opporuniy of orking hie commuing coud have far-reaching consequences on he choice of mode. he abiiy o use rave ime o perform a producive aciviy such as paid ork i affec he vaue of ime of riders. If he benefis are found o be subsania, his coud shif he focus aay from decreasing he door-o-door journey ime o improving he ride, such ha he possibiiy of ork or eisure is enhanced. his may incude beer seas, provision of abe suppies and eecrica oues for apop compuers. For ranspor professionas, is mos imporan effec coud be a possibe change in he reaive advanage of pubic ransporaion. An imporan deeran of mode choice, he vaue of rave ime (VO) has he idey acceped definiion as he amoun of money a rider is iing o pay for a saving of ime in rave (Viain and Bhandari, 2002, Jara-Diaz and Guevara, 2003) hie remaining equay e off. In conras o his definiion based on ime saved, he vaue of ime for aciviies oher han rave is usuay measured by he ime spen on hose aciviies. ha is, noihsanding he fied of ork in he posiive uiiy of rave, (Richardson, 2003, Mokharian, 2005), ime in ransi has a negaive uiiy for many, hereas ime spen on mos oher aciviies has a posiive uiiy. he abiiy o engage in a producive aciviy hie in ransi i herefore oer VO. In his paper e sudy he effec of adding ireess inerne access o ransi modes on VO. he core issue being goods-ime subsiuion, e mode he effec of ork in ransi using aciviy choice modes aong he ines of Becker and DeSerpa among many ohers (Becker, 1965, DeSerpa, 1971). Whie his effec may be sudied by incuding inerne access as a dummy variabe in a mode choice mode, he use of aciviy choice modes permi greaer undersanding of he reaion of in-ransi ork ime ih oher aciviy imes. he sudy provides a basis for exporing he effec of inerne access, on a broader se of aciviies and choices incuding eisure and e- shopping, in addiion o he effec on ork ha is he subjec of his sudy. he indirec uiiy funcion for mode choice is derived from he aciviy choice mode frameork 2

3 3 fooing an approach proposed by rain and McFadden, he paper is organized as foos. he reevan background ieraure is discussed in Secion 2. In Secion 3, severa aciviy choice modes are formuaed. hese modes and he VO derived from hem, represen he effec of ork in ransi paramericay. Subsequeny, e iusrae some numerica exampes. In Secion 4, he resus of a survey conduced on CCJPA rains are summarized o assess users iingness o pay. In Secion 5, he exension of he aciviy choice mode and he impicaion of inerne access on mode choice are expored. Secion 6 concudes he paper ih a genera discussion and idenificaion of furher ork. 2. Background Much of he ieraure on aciviy choice anaysis buids on Becker s sea ork (Becker, 1965) and is furher deveopmen by DeSerpa, he basic mode is one of uiiy maximizaion subjec o consrains on money and ime budges. In he origina form Becker considered uiiy as a funcion of fina aciviy bundes ha are combinaions of marke goods and ime spen in heir consumpion. DeSerpa inroduced an addiiona echnoogica consrain inended o refec he reaion beeen he imum ime needed and he amoun of an aciviy ha is consumed. Aciviies for hich his consrain is no binding are eisure aciviies (DeSerpa, 1971). DeSerpa s approach is formuaed as foos: (1) (2) (3) In his form U is he uiiy funcion, X, he vecor of goods consumed, and he vecor o of ime spen in consumpion. P is he price vecor and Y is he oa income. is he oa ime avaiabe and i is he ime spen consug he i-h good of he n good (aciviy) bundes. he echnoogicay or insiuionay deered imum amoun of ime required o consume one uni of X i is represened as a i. λ,ψ, and κ i are Lagrange muipiers so ha λ is he margina uiiy of income, ψ he margina uiiy of ime, κ i he margina uiiy of saving ime in he i-h aciviy, and he raio κ i / λ is he vaue of saving ime in i-h aciviy. Eq. (1) represens he objecive funcion for maximizaion of uiiy as a funcion of goods and ime. Eq. (2) represens he income consrain and Eq. (3), he ime budge consrain. he echnoogica consrain is represened by Eq. (4). o use his mode for he evauaion of VO, Jara-Diaz and Guevara, 2003, proposed a Cobb-Dougas uiiy funcion and denoed rave ime and rave cos as disinc variabes. he mode foos: θ θ θi ηk MaxU Ω X (5) W i I i k K k (4)

4 4 W Pk X k c 0 λ (6) k K τ 0 ψ (7) W i I i Ω is a uiiy consan, W,, i are he ime bundes spen on ork, rave, and oher aciviies respecivey. X k is he k-h commodiy, P k, he price of he k-h commodiy,, he age rae, and c he rave cos. τ is he ime budge and is he imum ime required for rave. I is he se of a aciviies excep ork and rave and K is he se of a goods. θ, θ, θi and η k are parameers corresponding o ork, rave, oher aciviies and goods respecivey. he Lagrange muipiers are he same as DeSerpa s mode, ih κ represening margina uiiy of saving ime in rave. As in he previous mode, Eq. (1) represens he objecive funcion, Eq. (2) represens he income consrain, Eq. (3) he ime consrain, and Eq. (4) he echnoogica consrain. I is o be noed ha in his form, represens pure rave ime ih no aciviy being performed during rave. Aso, rave ime is he ony ime bunde for hich a echnoogica consrain has been considered. In rave, he echnoogica consrain represens exising echnoogies and boundaries, as a resu of hich a imum rave ime beeen o paces is sipuaed. When rave has a posiive uiiy, i.e. for eisure rips, he consrain is no binding. 3. Modeing he Vaue of Working in ransi o mode he effec of orking hie in ransi e modify he Jara-Diaz and Guevara, 2003 mode by inroducing he aciviy ork in ransi () and adding he ime spen orking in ransi ino he reevan eemens of he uiiy maximizaion probem. In he fooing subsecions, e deveop some aernaive modes of boh pure rave ime and hybrid ork-rave ime and expore he form of he VO cacuaed from hese modes. he compee se of modes is represened diagrammaicay in Figure 1. Cobb-Dougas Modes (8) Jara-Diaz (2003) mode fuy-consrained mode i) pure rave ime iii) ork-inransi rave ime ii) pure iv) ork-inransi Linear Modes v) Pure rave ime mode vi) Work-in-ransi mode FIGURE 1 Represenaion of he modes

5 5 3.1 Pure rave ime Modes he firs pure rave ime mode is a re-saemen of he Jara-Diaz and Guevara, 2003 mode. I is referred o subsequeny as mode (i). α β γ η MaxU X (9) k r px c 0 λ (10) τ 0 ψ (11) 0 κ (12) For his and a subsequen modes in his paper,,, are he ime bundes spen on ork, rave, and oher aciviies respecivey. X is he commodiy bunde, p, he price of he commodiy bunde, r he age rae, and c he rave cos. τ is he ime budge and is he imum ime required for rave. and η are he uiiy easiciies of ork, rave, oher aciviies and goods respecivey, and he Lagrange muipiers are he same as in he previous mode. If, he VO obained from his mode for compusory, non-eisure rave such as ork rips for binding echnoogica consrain is: κ px[( γ / ) ( β / )] px px (13) [ γ β / m] [ mγ β ] λ η η η I is eviden ha VO is direcy proporiona o px, he oa spending, and inversey proporiona o η and, he imum sipuaed rave ime and he conribuion of he goods bunde o he uiiy. I is aso inversey proporiona o η and, i.e. he produc of eisure ime and he conribuion of he goods bunde o uiiy. his is consisen ih oher sudies of he vaue of rave ime such as Richardson, 2003, hich finds ha high income riders ih a greaer vaue of consumpion bunde vaue heir ime more and are iing o pay more o decrease rave ime, as compared o he income poor. Aso, for he ime rich, as oa eisure ime increases, i becomes increasingy ess imporan o pay a high amoun o reduce rave ime. Wih an increase in oa rave ime, a rider oud an o pay increasingy ess for a margina decrease in rave ime. he fac ha i is inversey proporiona o he coefficien of he marke good in he uiiy funcion is inuiive. When he marke good conribues a arge share of a rider s uiiy, ime conribues a reaivey smaer share and as such, VO is no very high. he above resu of VO can be re-saed in his aernaive form: κ r ( β γ ) (14) λ ( γ ) his iusraes he manner in hich VO varies direcy ih income, r. Anoher simpificaion can be obained by eing he raios / n and / m, hich yieds he fooing expression for VO. κ rn( β γm) (15) λ m(1 γn) Conrary o expecaion, VO decreases ih he increase in he raios of rave ime o eisure ime. A ikey expanaion for his resu is ha, he popuaion ih a high raio of commue ime o eisure ime represens he oer income group ih he onger

6 6 commue ime. Hoever, he mode aso shos ha, he higher he raios of ork ime o eisure ime, he greaer he VO, since such characerisics are possibe indicaors of he higher income orking popuaion. For he case of eisure rips, since he echnoogica consrain is no binding, VO is zero for > a opimaiy because κ is zero. Mode (ii) is obained from mode (i) by adding hree echnoogica consrains. he firs, Eq. (16) paces a oer bound ( ) on ork ime, Eq. (17) reaes eisure ime o consumpion of a goods bunde and Eq. (18) paces a oer bound (X ) on bundes of goods consumpion. Mode (ii) ih he addiiona echnoogica consrains is as foos. MaxU r α β γ X η k px 0 λ c τ 0 ψ bx 0 κ (17) X X κ (18) x Inerpreaion of he echnoogica consrain reaing o ime a ork is ha, a he margin, a imum amoun of insiuionay deered ime needs o be spen for ork. For hose ih a posiive uiiy of ork, he consrain is no binding. Simiary he consrain reaing ime and consumpion saes ha a imum amoun of ime mus be spen for consumpion of a cerain goods bunde, and his ime can be exceeded for eisure aciviies. he echnoogica consrain reaing o consumpion saes ha consumpion may be greaer han or equa o he imum necessary consumpion. For insance, a person may induge in buying four shirs here one as necessary. I is assumed ha a opimaiy,, >bx and X> X, ha is, he echnoogica consrain reaing o ork ime is binding a opimaiy hereas he oher o consrains are no binding. Aso, he imum consrain on consumpion is no binding. VO obained from mode (ii) is he same as ha obained from mode (i), Eq. (13). Hoever, due o presence of addiiona consrains, he direc proporionaiy o income, i.e. Eq. (14) canno be verified. he nex discussion invoves he effec of combining paid ork during rave in he Cobb-Dougas mode. 3.2 rave ime Modes ih Work in ransi Mode (i) and mode (ii), deveoped in he previous secion, are modified in his secion o incude, he ime spen orking in ransi. Modifying mode (i) resus in he fooing resaemen of he uiiy maximizaion probem referred o subsequeny as mode (iii): α β δ γ η MaxU ( f ) ( ) X (19) r px 0 λ c k (16)

7 7 τ f ) 0 ψ (20) ( 0 κ in hich f is an efficiency facor. Hensher, 1977, inroduced he concep of produciviy of ork done hie raveing reaive o ha a he orkpace. We posuae ha orking hie raveing has an efficiency facor f ( 0 f ) such ha he ork done in ime hie raveing, is equivaen o ork done in ime f a he fixed orkpace. he vaue of f depends on he naure of ork, i.e. he exen o hich he ork can be performed in ransi and aay from he fixed office ocaion. Aoing f>1 capures he possibiiy ha ransi provides a preferred venue for orking since here is no inerrupion from coeagues. Mode (iii) is vaid under he condiion ha f>0. From he firs order condiions, he fooing expression is obained for he VO: κ γ / β /( ) (21) λ η / px he expression yieds ha VO is independen of he coefficien of ork ime,α, he coefficien of rave ime, β, and he coefficien of ime of ork in ransi, δ. Hence VO i be he same, heher or no ime of ork in ransi is eighed he same as ork ime, rave ime or differeny in he uiiy funcion. Mode (i) Eq. (13) may be modified o obain he fooing form of he VO: κ γ / β / (22) λ η / px On comparing Eq. (21) and Eq. (22), i is eviden ha for a posiive vaue of, he mode shos a reducion in VO as compared o he pure rave ime mode, as a resu of he abiiy o ork hie in ransi. he resu obained from mode (iii) shos ha he VO is independen of f. Mode (iv) he echnoogica consrains represened by Eq. (16), Eq. (17), and Eq. (18) in mode (ii) aso appy o mode (iv). Mode (iv) ih he addiiona consrains is as foos. α β δ γ η MaxU ( f ) ( ) X r px 0 λ c ( f ) τ 0 ψ bx 0 κ X X κ x his mode oud incude a furher consrain, Eq. (23), hich represens he non-ork componen of rave ime, such as aiing ime, ou of vehice rave ime ec. a κ (23) In addiion, here is a non-negaiviy consrain on ime for ork in ransi. k

8 8 0 κ 1 (24) Some assumpions are made on he compemenary sackness condiions a opimaiy. A opimaiy, i is assumed ha a rider spends he imum required ime on rave,, κ > 0, and on ork a he orkpace,, κ > 0. During he commue, he rider effecivey uiizes a possibe ime on ork, i.e. a ime excep aiing ime, ou of vehice rave ime ec, a, κ > 0. he rider spends more han he absoue imum ime on consumpion, bx, κ 0, and he number of unis of consumpion is aso no bound o be he imum X X, κ 0. Furher, > > x ime of ork in ransi is posiive, > 0, κ 1 0. he VO is obained as foos: κ px γ (1 f ) δ fα (25) + λ η f In he form of VO obained in Eq. (25), VO decreases ih an increase in he vaue of f, if γ is arge as compared oα. his is equivaen o he decrease in VO due o an increase in he efficiency of ork during rave for hose riders, for hom ime spen in oher (eisure) aciviies; conribue a greaer proporion of posiive uiiy han ha spen a ork. he VO cacuaed in his case is ess han ha fγ δ fα β cacuaed for he mode ihou if + < f I is cear ha, as compared o mode (iii), mode (iv) beer represens he manner in hich VO may be affeced by he inroducion of echnoogies ha enabe ork in ransi. 3.3 Numerica Iusraion ih a Linear Uiiy Funcion o deveop a numerica exampe e adop he inear uiiy funcion aong ih he consrain for mode (ii) and mode (iv) o find he change in VO Pure rave ime Mode A greaer number of consrains are required for he inear form han for he Cobb- Dougas form o ensure ha none of he goods and ime bundes is zero a opimaiy. he inear form of he aciviy choice mode represening pure rave ime referred o as mode (v) foos: MaxU ν + α + β + γ + ηx (26) r px 0 λ c τ 0 ψ bx 0 κ

9 9 X X κ x On making he same assumpions on he compemenary sackness condiions a opimaiy as in mode (ii) VO is obained as: κ γ β ) p( (27) λ η his is direcy proporiona o price of he marke good and inversey o is coefficien in he uiiy funcion as in he case of he Cobb-Dougas uiiy funcion. VO aso increases ih increase in he coefficien of ime for oher aciviies in he uiiy funcion and decreases ih increase in he coefficien of rave in he uiiy funcion, as is inuiive rave ime Mode ih Work in ransi he inear mode represening effec of ork in ransi is formuaed as: MaxU ν + α( f ) + δ + β ( ) + γ + ηx (28) r px 0 λ c ( f ) τ 0 ψ a κ bx 0 κ X X 0 κ 1 κ x As in case of he Cobb-Dougas mode, his mode is vaid ony for vaues of f>0. he assumpions on he compemenary sackness condiions a opimaiy are same as ha in mode (iv). he VO obained from his equaion is: κ p[ γ + δ 2β f ( γ α)] (29) λ η In his form, he VO decreases ih an increase in he vaue of f. I aso decreases ih an increase in he vaue of β, he coefficien of rave ime. I increases ih increase in p, he price of he goods bunde,α, he coefficien of ork ime and δ, he coefficien of ime of ork in ransi. I aso increases ih an increase in he vaue ofγ, he coefficien of ime for oher aciviies excep for he case f1 hen he VO becomes independen ofγ. Since a he coefficiens of he differen ime and goods bundes are incuded in he VO i is imporan ha have a coefficien differen from ha of rave ime or ork ime. he VO obained is ess han ha obained from mode (v) if: δ < β + f ( γ α ) For boh expressions of VO cacuaed in he inear uiiy mode, i is observed ha VO is direcy proporiona o he price of he marke good and inversey o he coefficien of he marke good in he uiiy funcion. Reca ha his is simiar o he Cobb-Dougas form of mode (iv).

10 10 In he nex secion f is varied paramericay for he mode ih inear uiiy funcion o evauae he effec of inerne access on he vaue of ime Numerica Exampe A numerica exampe, assug hypoheica coefficiens, hypoheica vaues, and a inear uiiy funcion, is used o iusrae he effec of ork in ransi. Wih no ork in ransi, he uiiy maximizaion probem is as foos. Numerica Exampe (1) MaxU X (30) 20 5X 6 0 (31) 24 0 (32) 1 0 (33) X 3 0 (34) Eq. (30) represens he objecive funcion ih uiiy as a inear funcion of ime aocaed o ork, rave, eisure and he goods bunde. Eq. (31) represens he income consrain in hich he person s age rae is 20 money-unis/uni ime. he price of goods is 5 money-unis, and ha of ransporaion if 6 money-unis. Eq. (32) represens he ime consrain ih a cap a 24 ime-unis. Eq. (33) represens a echnoogica consrain in hich he person s rave ime is exogenousy consrained o be a imum of 1 ime uni. I may be onger if rave is perceived as a eisure aciviy. Eq. (34) represens he oher echnoogica consrain in hich consumpion of he goods bunde is endogenousy consrained o ake a maximum of hree imes he eisure ime, or aernaivey, eisure ime is a eas he ime required o consume one-hird of he goods bunde. he souion o his is as foos: U* , 12.97, 10.03, X VO K / λ 6 / money unis / uni ime No assug presence of inerne access, permiing ork during rave, ih f 0.8, he uiiy maximizaion probem is as foos. Numerica Exampe (2) MaxU 5 ( ) + 3( ) X (35) 20 5X 6 0 (36) 24 ( 0.8 ) 0 (37) 1 0 (38) X 3 0 (39) In Eq. (35), he uiiy funcion is a inear funcion of he ork ime, ork in ransi ime, eisure ime, rave ime, and he goods bunde. he raio of efficiency of ork during ransi compared o ork a he orkpace is 0.8 (Eq.(36). he souion o his exampe is: U* 214 1, VO K 13.43, 10.37, X 40.29, / λ 0.8/ 0.2 4unis / uni ime 1

11 11 he resus obain ha ih he presence of inerne aoing he overapping of ork ih rave, he vaue of uiiy increased from unis o 214 unis. he VO dropped from 30 money-unis per uni ime o 4 money-unis per uni ime. For riders ho can ork a an efficiency of 0.8 during commue as ha compared o he orkpace, he vaue of inerne access i be equa o he difference beeen he o VO, i.e. 26 unis. If inerne service is priced a 26 unis, he pricing oud exrac a he ren from he provision of inerne connecion. Aernaivey, if i is priced a ess han 26 unis, hen here oud be a moda shif in favor of he mode ih he inerne connecion. Whie he focus of his sudy is on ork in a neorked environmen, many aciviies are aready carried ou in ransi in absence of he ireess inerne connecion. hese aciviies, such as reading, riing, kniing ec. are aready carried ou consiue ork in ransi. As such, for a pracica purposes, here is no pure ork siuaion, and he difference in VO i be for o siuaions of ork in ransi, one in a neorked environmen and he oher ihou. he difference, as such, i be ess seep. For various vaues of f in numerica exampe (2), he vaues of VO and uiiy are shon in abe 1. I is observed ha ih increase in he vaue of f, he VO decreases and he uiiy increases. he decrease in VO is inear as is aso eviden from he parameric form of VO. A f1, i.e. a efficiency equa o ha of he orkpace, he mode accuraey yieds VO o be zero. ABLE 1 Vaues of VO and objecive funcion for differen vaues of f f VO VO Uiiy ($/hr) (% of houry age rae) 0 (no ork -6/ in ransi) 0.5-2/ / / Findings from Hisorica Daa and a Survey Conduced aboard San Jose- Sacrameno rain Hisorica ridership daa obained from Capio Corridor Join Projecs Auhoriy (CCJPA) for he period Sepember 2004 o March 2005 reveas some rends in ridership. Weekday ridership ranged from 3000 o 5000 rips per day, and eekend ridership ranged from 1500 o 2500 rips per day. Regarding rave frequency, i as observed ha jus over 50% of riders ho rave over 20 imes a year are on heir daiy commue o and from ork. I is ikey ha is ireess inerne connecion is provided; his 50% i be he primary marke of he service (Kanafani, 2005). A survey as conduced on he CCJPA San Jose o Sacrameno rain o assess he

12 12 possibe marke for ireess inerne connecion on rains for over one eek in Juy he average rave ime is 99 ues (imum 15ues, maximum 256, sandard deviaion 37 ues), he average number of rips per year is 150 (imum 1, maximum 720, s.d 178). Of he 1092 responses received, 50 % of he popuaion raves more han 94 imes a year and 50 % of he popuaion raves more han 50 ues per rip. 65% of he riders expressed iingness o use he service if free and 26% oud pay for i. 27% expressed ineres in increasing he number of rips if he service is inroduced. 67% ere business riders and 33% ere non-business riders. Of he business riders 44% expressed iingness o pay for he service and 56% oud use he service if i ere free. Of he non-business riders, ony 20% expressed ineres o pay for he service (Kanafani, 2005). he survey reveaed furher informaion on he iingness o pay based on he duraion and frequency of he ride. he informaion based on he duraion of he ride is shon in abe 2 and ha on he frequency of he ride is shon in abe 2. ABLE 2 Poenia users iingness o pay based on duraion of ride (business users ony) <80 ues ues >185 ues Percen business riders iing o pay for service Percen business riders iing o use service ony if free oa I is eviden ha he commuers ih onger rip enghs are iing o pay o use inerne on rains so ha hey coud conver heir rave ime o usefu ork ime. Commuers ih shorer rip enghs hereas, do no fee compeed o pay for using inerne on rains. he survey aso reveaed informaion on he preferred sraegy of paymen, houry, daiy, monhy or per rip, as e as he amoun ha he users oud pay under each caegory of paymen. his informaion has been segregaed as he mean fa rae for he occasiona, average and frequen commuers. For he houry rae, he occasiona riders are hose ho rave for ess han 60 ues one ay and he frequen riders are hose raveing for more han 312 ues one ay. hose raveing beeen 60 and 312 ues one ay consiue he average rider. For charge by day, hose raveing beeen 20 and 80 imes a year consiue he average rider, hose raveing ess han 20 imes, he occasiona rider and more han 80 imes, he frequen rider. For charge by rip, hose ho rave ess han 99 imes a year consiue he occasiona user and hose raveing more han ha are he frequen user. he monhy charge has been deered on he basis of daa for ime conneced. he occasiona users are hose ho propose o connec for ess han or equa o 80 ues and he frequen user are hose ho propose o connec for more han 80 ues. he average user has been cacuaed by finding he mean of a passengers ho preferred o pay using he monhy mode of paymen.

13 13 ABLE 3 Poenia users iingness o pay based on frequency of rave Occasiona rider/user Frequen rider/user Average rider/user Maximum price per hour ($) Maximum price per day ($) Maximum price per rip ($) Maximum price per monh ($) Excep for he case of monhy paymen, in a cases he occasiona rider agreed o a higher rae han he frequen rider. Since, for he monhy paymen, he iingness o pay is cacuaed on he basis of number of hours conneced, he frequen user averages a higher sum han he occasiona user. Differen ypes of commuers oud have differen preferred modes of paymen. he frequen rider oud find i economica o buy a monhy pass, hereas he infrequen one-ay commuer raveing for one hour or ess oud prefer he houry rae. he infrequen commuer ih duraion of rip onger han o hours i prefer he per rip charge. Of he previous caegory, hose ho i make more han one rip on he same day, for insance a reurn rip, i prefer he daiy pass. abe 3 shos he iingness o pay of poenia users. Excep in he case of charge by monh, in a cases he frequen rider agreed o a oer fa rae han he occasiona rider, so as o reduce overa coss.

14 14 Demand Curve for Houry Paymen Demand Curve for Per rip Paymen $/hour 5 4 $/rip Number of Users Number of Users Demand Curve for Per Day Paymen Demand Curve for Paymen per Monh $/day 8 6 $/monh Number of Users Number of Users FIGURE 2 Demand curves for he differen paymen sraegies Figure 2 shos he pos of he demand curves for he differen paymen sraegies. A pos exhibi a gradua sope in he oer price ranges bu a seeper one in he higher price ranges. Since margina cos is zero in hese cases, e can assume ha he price a hich revenue is maximized i be he informaion obained from he demand curve. 77% of he riders possess high speed inerne connecions a home. As such, o acceerae user s adopion of he inerne conneciviy service on rain, he service needs o be offered based on an infrasrucure ih higher bandidh and a secure operaiona environmen. Hoever, exising ireess echnoogies can ony offer o-bandidh infrasrucure as a viabe communicaion opion.. 5. he Indirec Uiiy Funcion and he Mode Choice Mode rain and McFadden, 1978, iusrae o aernaive mehods of esimaing he indirec uiiy funcion for a mode choice mode from a Becker ype aciviy choice mode. In he firs mehod, he opima vaue of is obained and subsiued in he uiiy funcion. In he second mehod he expendiure funcion is firs esimaed. We used he second mehod o derive he indirec uiiy funcion for he Cobb-Dougas modes, (ii) and (iv). Hoever, he indirec uiiy funcion for he inear uiiy funcion coud no be derived, since he process of differeniaion rids he expression of he variabes. For Eq. (9), he Cobb-Dougas uiiy funcion represening pure rave ime, he

15 15 form is firs modified o incude he inequaiy consrains in mode (ii) ha are assumed o be binding a opimaiy. his eads o he fooing form of he uiiy funcion: U α β γ W X η he indirec uiiy funcion, as cacuaed by firs finding he expendiure funcion is: ( γ + η ) Y A[ r( τ ) c 1 ] α β γ γ η η here A W [ ] [ ] r( η + γ ) p( η + γ ) he Cobb-Dougas uiiy form represening ork in ransi, Eq. (19), is modified o incude he inequaiy consrains of mode (iv) assumed o be binding a opimaiy, is as foos: α β δ γ η U [ f ( a)] a ( a X W ) he indirec uiiy funcion in his case, aso cacuaed by he expendiure funcion mehod as expained in rain and McFadden (6) is: ( γ + η ) Y B[ r( τ ) c 2 ] α δ β γ γ η η here B [ f ( a)] ( a) a [ ] [ ] ] r( η + γ ) p( η + γ ) he indirec uiiy funcion derived from he aciviy choice modes ends isef o an eegan represenaion of ork in ransi. he probabiiy of choosing he mode ih inerne connecion (mode 2) assug a ogi mode is: P ( Y e 2 ) e A[ r( τ Y 1 Y2 e + e e ) c Y 2 B[ r( τ ( γ + η ) ] ) c + e ( γ + η ) ] B[ r( τ ) c ( γ + η ) ] 6. Concusion & Discussion Using aciviy choice modes, his sudy shos ha combining ork ih rave increases he uiiy of he rider and reduces VO. he exen of his effec depends on he form of he uiiy funcion. For Cobb-Dougas uiiies, VO depends on he various aciviy imes, consumpion paerns, efficiency facors and he coefficiens in he uiiy funcion. In he inear uiiy modes VO depends on he efficiency facor and coefficiens ony. he difference in VO obained, beeen ork in ransi and no ork in ransi siuaions, may be used o guide he deveopmen of a pricing scheme for a service, ike ireess inerne connecion ha aids he possibiiy of ork in ransi. his sudy aso expores a mehodoogy of esimaing he indirec uiiy funcion from he aciviy choice mode so as o formuae a mode-choice mode. his sudy and ohers (Kirby, e.a.2007, Zhang, e.a. 2006) have shon ha adding possibiiies of usefu aciviies o rave is beneficia. Wih ireess inerne connecion becog ubiquious in every sphere, adding o he scope of ork in ransi,

16 16 his sudy is an inroducion of a ne research agenda. here are many possibe benefis and disbenefis o he phenomenon of depoymen of inerne connecion on rains and ransi. he concep of he mobie office coud change our percepion of rave, and shif he focus from he speed of rave o he comfor and convenience of rave. Hoever, inroducion of inerne service i no necessariy affec every rider. hose ih shor commues, ih commues in croded buses or rains, or ih many ransfers i no gain much. Many ork ypes for insance ha of assemby ine orkers have ie benefi from an inerne connecion. Finay, inerne users end o have higher incomes and more educaion han he average person (GAO, 2001). As such, ony hose sysems ha serve a majoriy of such riders coud use i. Whie recognizing ha here are many riders ho i no use he service, here is a possibiiy ha he mobie office environmen may affec he enjoymen of heir rave ime adversey (Zhang, e.a. 2006). For hose ho i use he service, he shif of focus aay from he duraion of commue ime, may cause riders o reside a ong disances from heir pace of ork causing urban spra and is associaed disbenefis. Fuure ork on his sudy i focus on vaidaing he modes ih daa and exporing he effec of an in ransi inerne connecion on rave choices ha go beyond mode choice. his incudes vauing he benefis of in ransi inerne access and exporing he effecs on home-orkpace vocaiona dynamics. Acknoedgemen his research as suppored by a gran from he US-DO funded Region 9 Universiy ransporaion Cener a he Universiy of Caifornia a Berkeey. he survey as by Carans for he projec Caifornia rains Conneced, ask Order PAH References Becker, G.S., A heory of he Aocaion of ime. he Economic Journa, Vo. 75, No. 299, DeSerpa, A.C., A heory of he Economics of ime. he Economic Journa Vo. 81, No.324, Hensher, D.A. (1977) Vaue of Business rave ime, Pergamon Press, Oxford, pp 159. Jara-Diaz, S.R., Guevara, C.A., Behind he Subjecive Vaue of rave ime Savings: he Percepion of Work, Leisure, and rave ime from a Join Mode Choice Aciviy Mode, Journa of ranspor Economics and Poicy, Vo. 37, No.1, Kanafani, A., e a Caifornia rains Conneced, Fina Projec Repor, ask Order PAH Kirby, H.R., Usefu Aciviy Whis raveing Adds Vaue, he 11 h Word Conference on ranspor Research. Mokharian, P.L., rave as a desired end, no jus means, ransporaion Research Par A: Poicy and Pracice, Vo. 39, Issues 2-3,

17 17 Richardson, A.J., Evidence of raveers ih Zero Vaue of ime, ransporaion Research Record: Journa of he ransporaion Research Board, No.1854, RB, Naiona Research Counci, Washingon D.C., eecommunicaions: Characerisics and Choices of Inerne Users, 2001, Unied Saes Genera Accouning Office, GAO , pp rain, K., McFadden, D., he Goods/Leisure radeoff and Disaggregae Work rip Mode Choice Modes. ransporaion Research Vo.12, Viain, P.B., N. Bhandari, Differences in Subjecive and Socia Vaue of ime: Empirica Evidence from raffic Sudy in Croaia, ransporaion Research Record: Journa of he ransporaion Research Board, No.1812, RB, Naiona Research Counci, Washingon D.C., Zhang, M., e a., Wireess Inerne on rains: Impac on performance of Business raveers,, ransporaion Research Record: Journa of he ransporaion Research Board, No.1977, ransporaion Research Board of he Naiona Academies, Washingon D.C.,