An economic analysis of incorporating new shared mobility into public transportation provision

• Published in: Transport policy 2023-09, Vol.141, p.263-273
• Main Authors: Wang, Yiyuan, Shen, Qing
• Format: Article
• Language: English
• Subjects: Generalized travel cost; Marginal cost; On-demand shared mobility; Public transit; Transportation simulation
• ISSN: 0967-070X; 1879-310X
• DOI: 10.1016/j.tranpol.2023.07.025

Transit agencies in the US have shown great interests in the possibility of incorporating on-demand shared mobility modes into their fixed-route transit services. However, the cost-effectiveness of on-demand modes has not been clearly demonstrated, and there lacks an effective method for transit agencies to compare the costs of different service provision options. This study develops an economic-theory-based framework that appropriately conceptualizes the total economic cost of incorporating on-demand modes into transit. Based on the theoretical framework, a simulation model is built to operationalize an approach for evaluating the cost-effectiveness of transit-supplementing, on-demand mobility services. We demonstrate the applicability of this approach using Via to Transit program in the Seattle region. By accounting for both the service provider's cost and the users' cost, we obtain a more complete and accurate measure for the cost advantages of the on-demand modes in this case in comparison to expanding fixed-route transit, where the total economic cost for the on-demand mode is 22% lower than the fixed route transit. The theoretical framework and the simulation model can support the decision-making of public transit agencies as they explore leveraging on-demand shared mobility to supplement traditional transit. •This paper developed a theoretical framework for conceptualizing the total economic cost of incorporating on-demand mobility into transit.•It built a simulation model to compare the cost-effectiveness of transit incorporating mobility on-demand with traditional service options.•It demonstrated the applicability of this analytical approach using a Via to Transit program, an on-demand mobility pilot, in the Seattle region.•It measured more completely and accurately the cost advantages of the transit incorporating mobility on-demand service in our case study area.