Econometric Analysis of Monthly Peak-Hour and Total Usage Patterns of Hong Kong’s Cross-Harbor Tunnels

As one of the most densely populated metropolises in the world, Hong Kong daily sees severe traffic delays at the Cross-Harbour Tunnel (CHT), though not at the Eastern Harbour Crossing (EHC) or the Western Harbour Crossing (WHC). In 2013, the Hong Kong Special Administrative Region (HKSAR) Government proposed raising the tolls of the publicly owned CHT and lowering those of the publicly owned EHC for nine vehicle types: private cars, motorcycles, taxis, three kinds of buses, and three kinds of goods vehicles. The privately owned WHC’s already high tolls, however, would remain unchanged. Using monthly usage and peak-hour usage data for January 2003 through June 2015, a Generalized Leontief demand system was estimated and found that private cars, motorcycles, and goods vehicles have price-sensitive tunnel usage patterns that are also time-dependent. The usage patterns of taxis and buses, which are public transportation vehicles, are totally price-insensitive. These findings suggest that the HKSAR Government’s proposed toll changes would reduce the CHT’s monthly usage by 7.4%–12.2%, and peak-hour usage by 5.0–16.8%. These usage reduction estimates suggest that a time-of-use (TOU) toll design can better manage CHT congestion than the current non-TOU design.