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http://dx.doi.org/10.7782/JKSR.2017.20.1.120

Study to Estimate the Economic Value of Railway Services Using a Contingent Valuation Method Focusing on Tourist Train Service in Korea  

Lee, Sang-Jae (Management Research Dept., KORAIL Research Institute)
Kim, Hyun-Koo (Mokpo Station, KORAIL)
Ahn, Se-Young (Management Research Dept., KORAIL Research Institute)
Publication Information
Journal of the Korean Society for Railway / v.20, no.1, 2017 , pp. 120-127 More about this Journal
Abstract
The South Korean rail authority is constructing a nationwide tourism belt by developing new rail tour routes in an effort to combine local tourism resources with rail service and to create value in regional areas. As massive financial resources are required to develop and operate such tourist trains, governing authorities are required to examine the feasibility of this project as a sound business model and to assess the public benefit and profitability of the project. In this study, the economic feasibility of the tourist trains was assessed with the contingent valuation method (CVM). According to an estimation of the willingness to pay of potential tour train passengers, the surveyed subjects were willing to pay fares that were higher than prices currently published at the time of this study, thereby demonstrating that the economic value they invest on tourist trains may be higher than published prices at the time. For instance, they were willing to pay 28.4% and 54.9% more for the O-train and V-train types, respectively, according to the study, suggesting that the quality as perceived by train passengers for tourist train services is relatively high. The study is significant in that it succeeded in quantifying the satisfaction level of tourist train passengers using quantitative data (additional funds people are willing to pay).
Keywords
Railway Service; Economic Value Estimation; Tourist Railway Train Service; Contingent Valuation Method;
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