VTT or VTTS: a note on terminology for value of travel time work

The value of travel time (VTT) can be said to be the most important number in transport economics, and its estimation has been the topic of extensive academic and applied work. Numerous papers use the term “value of travel time savings”, or VTTS. The addition of the word “savings” has not arisen suddenly but goes back to the 1970s, and has also been used in the titles of national studies. The addition of ‘savings’ is in our view incorrect, misleading and unhelpful. Unlike money, time cannot be stored or borrowed—there is no piggy bank for spare minutes. In addition, the modelling approaches used for many of the more advanced VTT studies in fact produce valuations that are ‘bracketed’ between gains and losses in time, and an average between these gains and losses, typically the geometric mean, is then used as the VTT. It is then clear that the value obtained from this averaging cannot be described as the value of time savings (or reductions), as it includes the higher value of losses (i.e. increases) as well. To exemplify the magnitude of our theoretical points, we show how for the 2015 UK VTT study, using the bracketed value for commuters and labelling it as a VTTS implies an overestimation by a factor of more than 2.