A model for time- and budget-constrained activity demand analysis

This paper describes and demonstrates the derivation of a system of demands for activity participation by applying microeconomic theory in a time–price setting. Both time and money constraints are incorporated explicitly and the integer nature of demand observations is accommodated via a multivariate negative binomial stochastic specification. A model based on this theory is calibrated, providing estimates of income, discretionary-time, and cross-time elasticities. The results reject a constant travel time hypothesis but do not reject a hypothesis of no income effects on total activity participation.