The tolls of privacy: An underestimated roadblock for electronic toll collection usage

Despite continuing population and economic growth in the Bay Area, the rate of adoption of FasTrak, the electronic toll collection system employed in California, has been significantly lower than similar systems in comparable urban areas of the United States. Prior economic research suggests drivers in California's urban areas have a revealed willingness to pay for the convenience of FasTrak that exceeds their current cost of FasTrak. Using survey results and other research, we find the slower progress of FasTrak is partially related to consumers' value of perceived privacy overweighing the implicit value of convenience. Similarly, our research suggests that either a change in consumers' perception of privacy in the FasTrak system, or a fiduciary compensation must be offered to Bay Area drivers' in exchange for their perceived reduction of privacy, if any significant increase of FasTrak usage is to be achieved.