Exploratory Method for Practitioners Analyzing the Impact of Integrated Fare Structures in Decentralized Metropolitan Regions

Abstract

Metrolinx, the regional transportation agency tasked with improving the coordination and integration of all transportation modes in the Greater Toronto and Hamilton Area, has developed an exploratory method for analyzing the effects of new fare structures that integrate the fare systems of multiple transit service providers in the region. The method uses a data set of all weekday trips made in the region segmented by modes used and origin–destination information. A formula derived from the mode choice modeling theory is used to obtain fare elasticity based on unit cost, mode share, and time of day. The distribution of elasticities produced is then calibrated according to a literature review of fare elasticities, and in the future, it will be done according to local market research. The result is a spreadsheet-based tool that provides analysts with an ability to test more complex changes to fare systems, including testing fare integration between agencies and introducing fares by distance, mode, time of day, or a combination of those features. Exploratory in nature, the method is not a replacement for comprehensive market research or fare pilots. However, it addresses the shortcomings of traditional fare analyses that use only aggregate elasticities for diverse market segments by better reflecting the spectrum of transit user sensitivities associated with specific travel characteristics. Furthermore, it provides analysts with a straightforward tool to test the effects of complex fare structures more commonly used in Europe and Asia enabled by smart card and open payment technology on ridership, revenue, emissions, and social equity.