Uber, Lyft or transit? The answer appears to align with how people value their time

Research led by the University of Michigan has arrived at a surprisingly unsurprising result while assessing the sustainability gap between public transit and services like Uber and Lyft, formally known as transport network companies or TNCs.

With data collected by the city of Chicago, the researchers studied people’s use of TNCs over transit, allowing the team to put a value on the time riders saved with their choices. The median value of that number, about $34 per hour, was virtually identical to the Chicago region’s median hourly wage.

The researchers have published their results in the journal Environmental Science & Technology.

“I was a bit surprised that our median estimate of the value of time was so close to the regional average wage. The median rider seems to value their time in a reasonable way,” said Parth Vaishnav, assistant professor at the U-M School for Environment and Sustainability. “At first sight, our research shows that people are behaving the way you would expect them to.”

The team dug deeper, too, affording further insights that could enable commuters to make more sustainable choices. While electrifying vehicles and new “congestion taxes” can mitigate the societal harms of TNC usage, the new work suggests that the largest gains could be found in making transit more convenient.

“If we can make transit more accessible to the user, we can make a huge impact,” said lead author Miki Tsuchiya, a research assistant at the U-M Center for Sustainable Systems.

Can taxing indirect costs put a dent in congestion?

In its study, the team—which also included Anna Cobb of Carnegie Mellon University—analyzed more than 200,000 rides taken in Chicago with TNCs, more commonly known as rideshares.

The trio then calculated how the cost and duration of each TNC trip compared with using transit to make the same trek. From that, the researchers could put a price on the time riders saved choosing Lyft or Uber over transit.

The team also incorporated factors such as air pollution, congestion, collision risk and greenhouse gas emissions associated with the modes of travel to tease out other impacts of riders’ choices.

“We worked to capture multidisciplinary perspectives focusing on the users,” Tsuchiya said. “Our benefit cost analysis included life cycle analysis, geospatial analysis and draws on insights from public health and environmental epidemiology.”

The team found that charging riders for these social harms using established costs would only modestly increase the value that people would have to place on their time to still choose TNCs over transit. Specifically, it nudged the median value of $34 per hour up to $37 per hour.

“If you were to tax riders based on how much harm they cause, it’s not clear they would behave any differently,” Vaishnav said.

That said, Chicago has implemented a congestion tax and other cities, notably New York, are currently rolling out their own, which will enable researchers to better study their effects moving forward. Currently, there’s not enough data to draw robust conclusions, but the early data do suggest relatively small dips in TNC usage, Vaishnav said.

The team’s analysis, however, did suggest larger gains could be found elsewhere.

Room for improvement

Electrifying the fleet of TNC vehicles, for example, would cut their air pollution and greenhouse emissions to a level that’s roughly equivalent to transit. Although this highlights an opportunity for reducing the environmental footprint of TNCs, the equivalency is also a product of the low average utilization of public transportation.

Excluding TNC trips outside of transit’s operating hours, the team found that 99% of TNC rides could have been carried out by some combination of city buses and trains. That is, the overwhelming majority of riders were using Uber and Lyft to go places that were served by transit. “I was surprised by that. I was also surprised that the average passenger load is low in Chicago,” Tsuchiya said, adding that, averaged over the time of the study, Chicago transit vehicles carried about 20% of their capacity. “One way to think of that is that the potential for transit in cities is huge.”

One way to tap into that potential is to boost the efficiency of transit, she said.

“About half of the time of a transit trip is the rider walking to a stop and waiting,” Tsuchiya said. “That means that half the time, people aren’t actually riding.”

Reducing wait times and the distances that riders need to cover on foot could go a long way, but developing policies to do that effectively requires more robust data, the team said.

For example, although experts know that transit usage is low on average, existing data isn’t granular enough to show when and where it could be most improved.

“The moral of the story is that we need more data,” Vaishnav said.