Posts Tagged ‘fare policy’

Off-Peak Fare Discounts and their Behavioral Implications

June 8th, 2016 4 comments

Metrorail riders facing a high percentage off-peak discount are motivated to delay their travel and save.

This post is guest-written by Sam Winward, a behavioral economist and Metrorail commuter who lives and works in the District. His analysis of Metro ridership patterns sheds light on the influence of off-peak pricing.

If you’ve ever waited a few extra minutes before swiping through a Metrorail faregate to qualify for the off-peak fare, you’re not alone. Within the afternoon peak / off-peak cusp period, when riders may be somewhat time flexible, Metrorail data from AprilMay 2015 confirms that some riders are delaying entry for savings.

What riders probably don’t know, is that their off-peak pricing discount could be substantially different from the riders around them. In fact, off-peak percent discounts can range from a 19% to 40% reduction of peak fares. Given the varying degree of off-peak incentive, riders are responding as we’d expect when weighing their opportunity cost of time.

As percent savings increase, riders are more likely to delay travel for off-peak fares. The graph below, derived from WMATA data, displays this ridership tendency.

Note the ridership uptick just after 7 pm. This runs counter to the natural pattern of declining ridership over this period, and the uptick steepens as the percent discount facing riders increases.

Exhibit 1_Ridership Uptick

So why is there so much variation in off-peak discounts, and who are the lucky riders allowed large savings?

Particular trips, based on mileage between origin / destination stations, are subject to off-peak fare “caps.” WMATA introduced the caps in 2012 when off-peak fares switched to incremental fee-per-mile pricing. Off-peak fares for trips of just under 7 and 10 miles were capped, as these trip distances would have otherwise seen very large increases between the old and new fare structure. A maximum off-peak fare cap of $3.60 was also implemented, affecting riders with trips lengths greater than 11 miles.

The effects of these fare caps remain in the system today, and are not mirrored in peak fares.

As displayed below, the gap between peak and off-peak fares increases over regions subject to off-peak fare caps. This makes off-peak travel more enticing for riders’ whose trip length falls within a green zone.

Exhibit 2_Fares

Notably, small tweaks in the fare structure have large behavioral effects.

Even if you decide that added off-peak savings aren’t worth the wait, at least your decision can be informed. To see the off-peak discount applicable to your route, and how it compares to the rest, check out the interactive off-peak discount calculator on my website.

The full story, including the off-peak discount calculator and a formal analysis of the delayed ridership patterns, can be found at Sam’s site.

“Virtual” Tunnel Yields Real Benefits

November 4th, 2014 16 comments

Use of the “Farragut Crossing” virtual tunnel is strong, averaging around 18,000 trips per month during the more temperate months, dropping to 15,000 during the winter.

Users of the Metrorail system come up with a lot of different ideas for how Metro can better serve their needs.  Ideas often come from the blogging community and are sometimes considered by Metro planners, researchers and leadership.  One such idea was the virtual tunnel between Farragut North and Farragut WestNow dubbed “Farragut Crossing” via a Facebook naming contest, this fare policy update allows transfers between the two Farragut stations without being charged two separate fares.

Farragut Crossing was first opened in October of 2011 and monthly usage increased from just a few thousand trips in its first few months to a max of over 21,000 in May of 2014.  Since then, it’s settled to around 18,000 during the fair-weather months.

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