Demand for transportation : a case study of ferry traffic between Victoria and Vancouver
Date
1981
Authors
Gardner, Philip Lawrence
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Abstract
The increasing application of computer modelling to the broad spectrum of transportation problems has resulted in the implementation of a variety of 'ad hoc' techniques and approaches, rather than to the development of one basic economic theory. This thesis examines a number of current approaches to transportation demand analysis in relation to their application to a specific problem of ferry demand.
The objective of the thesis is to provide an empirical evaluation of the demand functions for transportation on a major ferry route between the economic centre surrounding Vancouver and that of southern Vancouver Island. Previous studies of the demand for ferry transportation over this route have concentrated on specific aspects of the issue, such as pricing and congestion costs.
The transportation connection between the cities of Victoria and Vancouver consists of approximately 64 road kilometres and 28 sea miles. The crossing time by ferry takes around 100 minutes, while the airport-to-airport flight requires about 25 minutes, For most vehicles the ferry represents the only reasonable method of transportation between the two cities , since commercial barge is the only current alternative.
This paper develops an analysis of the demand function for service over the ferry route, for four categories of ferry traffic:
- auto equivalents (total number of vehicles but with commercial vehicles and buses subject to a factor of three);
- non-commercial vehicles,
- trucks, buses and trailers;
- passengers.
The seasonal aspects of the demand are analyzed using individual demand functions, and a binary dummy approach for both slope and intercept coefficients. The demand responsiveness for each of the seasonal periods was evaluated through calculations of the price and income elasticities for each of the traffic categories being examined.
The specifications of the models to be utilized in the traffic demand analysis were determined after examination of four of the established models of travel demand which had a demonstrated theoretical application to the type of time series analyses required by the data availability of the study.
The two model approaches selected for the empirical calculations of this thesis were the Roueche model, and the Quandt-Baumol abstract mode model. From the analysis, it is apparent that while price, income and exchange rate of the Canadian dollar are significant determining variables, the proxy variable for tourism had the major overall effect on demand for ferry transportation over the route. The seasonal analysis suggested that, while demands between periods may be related, the winter period represents the off-peak demand of predominantly local traffic, while the summer period is dominated by the peaking effects of tourist demand. The shoulder period shows a distinct demand between these two.
The price elasticity of demand was fauna to Be inelastic for all categories of service examined, and over all three seasonal periods, although it was particularly low during the summer period. This raises questions concerning the pricing policy of the B.C. Ferry Corporation, and suggests that there may be a more economically efficient approach, which could reduce the annual subsidy required by the Corporation.