High Speed Rail Cost Advantage

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Cost-Benefit Analysis of the High Speed Rail between Kuala Lumpur – Singapore

In 2013, Malaysia and Singapore jointly announced to build a high-speed rail line, which runs at 300 km/hour or above, between Kuala Lumpur (KL) and Singapore by 2020. The planned high-speed-rail between two capital cities is intended to ease the road congestion and meet the increasing transport demand between two capitals while shorten travel time to as little as 90 minutes. Given the 7.1 million populations of KL and Singapore combined, the Land Public Transport Commission of Malaysia claimed that a total of 66000 passengers would be traveling daily via the propose HSR (24 million annually). The figure may be reasonable, however, it should to be treated with
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According to Givoni (2006), the motives of constructing the first ever HSR in Japan, Tokaido line, was the increasing route capacity it offers to one of the most densely used corridors in the world. This was also the case for many other HSR, for example, the introduction of the HSR from Rome to Naples, it was built to cope with the increasing demand despite the fact that the gain in speed was relatively small. In Commission for Integrated Transport’s (2004) report, it adds weight to Givoni’s claim by suggesting that during the 1970s, UK did not consider the idea of building a HSR of its own mainly due to the spare capacity it has on the existing rail. Hence, it concludes that additional capacity is obviously only of value if the demand excess the capacity of the present rail, or relieving existing line of traffic for other types of service such as …show more content…
Regarding to the valuation in rail schemes, the Department For Transport in Britain (2009) has categorized the timesaving into three groups: Commuting, business and others. The business time holds a higher valuation due to the fact that much of the business travel takes place during working hours and that could affect the labour productivity.

Nonetheless, the business time valuation of work should consider an approach to valuation of time savings proposed by Hensher (1997). He points out three facts: (1) unless the all of the travel time saving is used for productive work purposes; (2) travel time is consider to be entirely unproductive, whereas work time is completely productive; (3) the labour market is perfectly competitive, where the marginal of wage equals to the value of marginal product of labour. Unless these three condition holds, the business time value estimation shows an improbable result.

However, an empirical study put forward by Mark, Fowkes and Nash (1986) stated that the deviations from the above condition are generally self-cancelling. In another word, some of the saved travel time may be productive, but some may go into leisure. But on

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