Modelling Travel Time Anticipation Under Rational Inattention and Endogenous Information Constraints

Abstract

Transportation research has been traditionally grounded on the economic theory of Rational Expectations, assuming that individuals are fully informed, optimizing, and self-interested decision makers. However, this assumption fails to sufficiently explain the inertia that characterizes travellers’ behaviour in face of uncertainty. In recent years, there has been a rising interest in the theory of Rational Inattention, arguing that individuals choose to make seemingly suboptimal choices due to the cost of acquiring and processing available information. In this paper, we present a continuous quadratic Rational Inattention model of travel time anticipation. We showcase that its properties satisfy behavioural hypotheses derived from data collected through a case study in the city of Turin on within-day travel re-evaluation. We conduct simulation experiments and propose an alternative 2-stage framework for enhancing existing neoclassical travel behaviour models, indicating potential biases and discrepancies in the forecasted market shares, specifically with regards to rare travel time occurrences.