IDEAS home Printed from https://ideas.repec.org/a/eee/transb/v94y2016icp22-42.html
   My bibliography  Save this article

Envy-minimizing pareto efficient intersection control with brokered utility exchanges under user heterogeneity

Author

Listed:
  • Lloret-Batlle, Roger
  • Jayakrishnan, R.

Abstract

We propose PEXIC (Priced EXchanges in Intersection Control), a new concept and algorithm for traffic signal control that incorporates user heterogeneity on value of delay savings. The algorithm assigns phases with associated delays, taking into account the vehicle travelers’ values for experienced delay. Applying principles of envy-freeness, we develop a pricing scheme that addresses fairness by minimizing user envy via compensatory monetary transfers among users. PEXIC is Pareto efficient and budget balanced, and thus financially self-sustainable without external subsidy. The optimization is solved sequentially on a rolling horizon basis: first the phasing, and next the pricing. PEXIC achieves significant cost reductions for a large range of volumes and users’ value heterogeneity levels. Inclusion of user heterogeneity also proved to be fairer than standard delay minimization that disregards individual vehicles’ values for delay savings. Furthermore, we show that arbitrage is not possible, thus there are no incentives to drive just to collect those payments. The method used has polynomial complexity and it is suitable for real-world implementation.

Suggested Citation

  • Lloret-Batlle, Roger & Jayakrishnan, R., 2016. "Envy-minimizing pareto efficient intersection control with brokered utility exchanges under user heterogeneity," Transportation Research Part B: Methodological, Elsevier, vol. 94(C), pages 22-42.
    • Handle: RePEc:eee:transb:v:94:y:2016:i:c:p:22-42
    DOI: 10.1016/j.trb.2016.08.014
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0191261516301953
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.trb.2016.08.014?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Diamantaras, Dimitrios & Thomson, William, 1990. "A refinement and extension of the no-envy concept," Economics Letters, Elsevier, vol. 33(3), pages 217-222, July.
    2. Edward Clarke, 1971. "Multipart pricing of public goods," Public Choice, Springer, vol. 11(1), pages 17-33, September.
    3. William Vickrey, 1961. "Counterspeculation, Auctions, And Competitive Sealed Tenders," Journal of Finance, American Finance Association, vol. 16(1), pages 8-37, March.
    4. Newell, Gordon F., 1989. "Theory of highway traffic signals," Institute of Transportation Studies, Research Reports, Working Papers, Proceedings qt7zn2b9bc, Institute of Transportation Studies, UC Berkeley.
    5. Arnott, Richard & de Palma, Andre & Lindsey, Robin, 1990. "Economics of a bottleneck," Journal of Urban Economics, Elsevier, vol. 27(1), pages 111-130, January.
    6. Marc Fleurbaey, 2008. "To Envy or To Be Envied? Refinements of the Envy Test for the Compensation Problem," Studies in Choice and Welfare, in: Prasanta K. Pattanaik & Koichi Tadenuma & Yongsheng Xu & Naoki Yoshihara (ed.), Rational Choice and Social Welfare, pages 95-118, Springer.
    7. Newell, G. F., 1998. "The rolling horizon scheme of traffic signal control," Transportation Research Part A: Policy and Practice, Elsevier, vol. 32(1), pages 39-44, January.
    8. Suvrajeet Sen & K. Larry Head, 1997. "Controlled Optimization of Phases at an Intersection," Transportation Science, INFORMS, vol. 31(1), pages 5-17, February.
    9. Small, Kenneth A, 1982. "The Scheduling of Consumer Activities: Work Trips," American Economic Review, American Economic Association, vol. 72(3), pages 467-479, June.
    10. Groves, Theodore, 1973. "Incentives in Teams," Econometrica, Econometric Society, vol. 41(4), pages 617-631, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Iliopoulou, Christina & Kampitakis, Emmanouil & Kepaptsoglou, Konstantinos & Vlahogianni, Eleni I., 2022. "Dynamic traffic-aware auction-based signal control under vehicle to infrastructure communication," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 608(P1).
    2. Jin, Wen-Long & Yan, Qinglong, 2019. "A formulation of unifiable multi-commodity kinematic wave model with relative speed ratios," Transportation Research Part B: Methodological, Elsevier, vol. 128(C), pages 236-253.
    3. Obara, Takuya & 小原, 拓也 & Tsugawa, Shuichi & Managi, Shunsuke, 2019. "Envy-free Pricing for Impure Public Good," CCES Discussion Paper Series 69, Center for Research on Contemporary Economic Systems, Graduate School of Economics, Hitotsubashi University.
    4. Rey, David & Levin, Michael W. & Dixit, Vinayak V., 2021. "Online incentive-compatible mechanisms for traffic intersection auctions," European Journal of Operational Research, Elsevier, vol. 293(1), pages 229-247.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. William H. Sandholm, 2005. "Negative Externalities and Evolutionary Implementation," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 72(3), pages 885-915.
    2. Wada, Kentaro & Akamatsu, Takashi, 2013. "A hybrid implementation mechanism of tradable network permits system which obviates path enumeration: An auction mechanism with day-to-day capacity control," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 60(C), pages 94-112.
    3. William H. Sandholm, 2002. "Evolutionary Implementation and Congestion Pricing," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 69(3), pages 667-689.
    4. Ruijie Li & Yu (Marco) Nie & Xiaobo Liu, 2020. "Pricing Carpool Rides Based on Schedule Displacement," Transportation Science, INFORMS, vol. 54(4), pages 1134-1152, July.
    5. Tafreshian, Amirmahdi & Masoud, Neda, 2022. "A truthful subsidy scheme for a peer-to-peer ridesharing market with incomplete information," Transportation Research Part B: Methodological, Elsevier, vol. 162(C), pages 130-161.
    6. Shrestha, Ratna K., 2017. "Menus of price-quantity contracts for inducing the truth in environmental regulation," Journal of Environmental Economics and Management, Elsevier, vol. 83(C), pages 1-7.
    7. Mishra, Debasis & Parkes, David C., 2007. "Ascending price Vickrey auctions for general valuations," Journal of Economic Theory, Elsevier, vol. 132(1), pages 335-366, January.
    8. Mizukami, Hideki & Saijo, Tatsuyoshi & Wakayama, Takuma, 2003. "Strategy-Proof Sharing," Working Papers 1170, California Institute of Technology, Division of the Humanities and Social Sciences.
    9. Soumyakanti Chakraborty & Anup K. Sen & Amitava Bagchi, 2015. "Addressing the valuation problem in multi-round combinatorial auctions," Information Systems Frontiers, Springer, vol. 17(5), pages 1145-1160, October.
    10. Toyotaka Sakai, 2017. "Considering Collective Choice: The Route 328 Problem in Kodaira City," The Japanese Economic Review, Japanese Economic Association, vol. 68(3), pages 323-332, September.
    11. , & ,, 2015. "Strategy-proofness and efficiency with non-quasi-linear preferences: a characterization of minimum price Walrasian rule," Theoretical Economics, Econometric Society, vol. 10(2), May.
    12. d'Aspremont, Claude & Cremer, Jacques & Gerard-Varet, Louis-Andre, 2004. "Balanced Bayesian mechanisms," Journal of Economic Theory, Elsevier, vol. 115(2), pages 385-396, April.
    13. Hiroki Saitoh & Shigehiro Serizawa, 2008. "Vickrey allocation rule with income effect," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 35(2), pages 391-401, May.
    14. John Duggan & Joanne Roberts, 2002. "Implementing the Efficient Allocation of Pollution," American Economic Review, American Economic Association, vol. 92(4), pages 1070-1078, September.
    15. Takashi Kunimoto & Cuiling Zhang, 2021. "On incentive compatible, individually rational public good provision mechanisms," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 57(2), pages 431-468, August.
    16. Pär Holmberg, 2017. "Pro‐competitive Rationing in Multi‐unit Auctions," Economic Journal, Royal Economic Society, vol. 127(605), pages 372-395, October.
    17. Song, Yangwei, 2018. "Efficient Implementation with Interdependent Valuations and Maxmin Agents," Rationality and Competition Discussion Paper Series 92, CRC TRR 190 Rationality and Competition.
    18. Youngsub Chun & Manipushpak Mitra & Suresh Mutuswami, 2014. "Egalitarian equivalence and strategyproofness in the queueing problem," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 56(2), pages 425-442, June.
    19. Kazumura, Tomoya & Mishra, Debasis & Serizawa, Shigehiro, 2020. "Mechanism design without quasilinearity," Theoretical Economics, Econometric Society, vol. 15(2), May.
    20. T. Tideman, 1983. "An experiment in the demand-revealing process," Public Choice, Springer, vol. 41(3), pages 387-401, January.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:transb:v:94:y:2016:i:c:p:22-42. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/548/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.