Optimal Road Pricing with Congestion and Fund Procurement Paper Identification number: SCS12-034 (original) (raw)
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It is well known that in the standard traffic network equilibrium model with a single value of time (VOT) for all users, a so-called marginal-cost toll can drive a user equilibrium flow pattern to a system optimum. This result holds when either cost (money) or time units are used in expressing the objective function of the system optimum and the criterion for user equilibrium. This paper examines the multi-criteria or the costversus-time network equilibrium and system optimum problem in a network with a discrete set of VOTs for several user classes. Specifically, the following questions are investigated: Are the user-optimal flows dependent upon the unit (time or money) used in measuring the travel disutility in the presence of road pricing? Are there any uniform link tolls across all individuals (link tolls that are identical for all user classes) that can support a multi-class user equilibrium flow pattern as a system optimum when the system objective function is measured by either money or time units? What are the general properties of the valid toll set? Ó equilibrium model and network performance evaluation because it describes how users make tradeoffs between cost and time in response to toll charges. Conventionally, VOTs are assumed to be identical for all users (homogeneous users). In the case of homogeneous users, the first-best congestion pricing theory, namely, the theory of marginal cost pricing is well established in general traffic networks. In line with this theory, a toll that is equal to the difference between the marginal social cost and the marginal private cost is charged on each link, so as to achieve a system optimum flow pattern in the network . Investigations have been conducted on how this classical economic principle would work in a general congested road network with queuing (Yang and Huang, 1998) and in a congested network in a stochastic equilibrium . In spite of its perfect theoretical basis, the principle of marginal cost pricing can be difficult to apply in real situations. Apart from public and political resistance, a primary reason is due to the high extra cost spent on the equipment for toll collection over the entire network. This has motivated a number of researchers to consider various forms of second-best pricing schemes where only a subset of links is subjected to toll charges. A typical simple example of the second-best pricing involves two parallel routes where an untolled alternative exists. This problem has been investigated in both static and dynamic situations by, for example,