Heterogeneity in behavioural response to pricing policies in the transition from motorcycles to private cars in motorcycle-based societies

Abstract

Pricing instruments are widely seen as an effective tool for reducing the travel demand for private vehicles. In contrast to developed countries, the design of pricing policies in certain developing countries is more challenging, owing to the mixed use of private cars and motorcycles. This study argues for the existence of a transitional group of motorcycle users who will switch to being car users. An investigation of the behavioural responses to a pricing policy from private car users and motorcycle users is implemented in Ho Chi Minh City, Vietnam. A propensity score-matching technique is used to identify the transitional group. The results regarding the mode choice models for various pricing policies show similar responses between the transitional motorcycle users and car users. Such characteristics of the transitional group imply that ignorance of travellers' heterogeneity may cause significant bias, especially when modelling pricing policies.