Equilibrium at a bottleneck when long-run and short-run scheduling preferences diverge
AbstractWe consider the use of a Vickrey road bottleneck in the context of repetitive scheduling choices, distinguishing between long-run and short-run scheduling preferences. The preference structure reflects that there is a distinction between the (exogenous) ‘long-run preferred arrival time’, which would be relevant if consumers were unconstrained in the scheduling of their activities, and the ‘short-run preferred arrival time’, which is the result of an adaptation of travel routines in the face of constraints caused by, in particular, time-varying congestion levels. We characterize the unpriced equilibrium, the social optimum as well as second-best situations where the availability of the pricing instruments is restricted. All of them entail a dispersed distribution of short-run preferred arrival times. We obtain the intriguing results that the dispersion is lower in the social optimum than in the unpriced equilibrium, and that the application of first-best short-run tolls does not induce efficient long-run choices of travel routines.
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Bibliographic InfoArticle provided by Elsevier in its journal Transportation Research Part B: Methodological.
Volume (Year): 57 (2013)
Issue (Month): C ()
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- Stefanie Peer & Erik T. Verhoef, 2013. "Equilibrium at a Bottleneck when Long-Run and Short-Run Scheduling Preferences diverge," Tinbergen Institute Discussion Papers 13-028/VIII, Tinbergen Institute.
- D80 - Microeconomics - - Information, Knowledge, and Uncertainty - - - General
- R48 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government Pricing and Policy
- R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion
- H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
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