Revealed Parking Choices and the Value of Time

This study uses 2005–2006 University of Wisconsin–Madison (UW–Madison) parking applications to model lot choice in terms of parking prices and walking distances and to determine how parkers value their walking times. UW–Madison employees apply for annual lot parking permits each year by ranking as many as four lots; the employees know that the highest ranked lot with available space will be offered to them. Parking choices are modeled as functions of walking distances, lot prices, and department priority indexes that reflect income, seniority, and status. The sample consists of 4,032 employees who work in 150 campus buildings and park in more than 60 lots. Lot prices vary from $435 to $1,025 per year, and walking distances from workplaces to lots range from a few feet to nearly 2 mi. The results are consistent across specifications. The estimated values of walking time vary from less than $4/h for low-status employees parking in low-priced lots to more than $30/h for high-status employees in high-priced lots. Choice is relatively inelastic regarding distance and more elastic regarding price. Choice models are used to estimate the effects of two price changes: (a) a single $650 annual lot price and (b) a $250 increase for all prices.