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A Credit-Based Congestion Management Scheme in General Two-Mode Networks with Multiclass Users

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  • Yang Liu

    (National University of Singapore)

  • Yu (Marco) Nie

    (Northwestern University)

Abstract

This paper examines the design of the credit-based congestion management schemes that achieve Pareto-improving outcome in general two-mode networks. It is assumed that transit is a slower but cheaper alternative to driving alone. The distributional welfare effects of congestion pricing on users with the different value of time (VOT) in Liu and Nie (Trans Res Board 2283:34–43, 2012) are used in developing Pareto-improving credit schemes. We show that, similar to the single-mode model, the sufficient and necessary condition for the existence of a discriminatory Pareto-improving credit scheme is the reduction in the total system cost. A sufficient condition for the existence of an anonymous Pareto-improving credit scheme is also derived. A cross-OD subsidization scheme is proposed when the sufficient condition is not satisfied for each origin-destination (O-D) pair. Numerical experiments on the expanded Sioux Falls networks with a log-normal VOT distribution demonstrate that the proposed Pareto-improving scheme can generate positive net revenue in the presence of good transit coverage.

Suggested Citation

  • Yang Liu & Yu (Marco) Nie, 2017. "A Credit-Based Congestion Management Scheme in General Two-Mode Networks with Multiclass Users," Networks and Spatial Economics, Springer, vol. 17(3), pages 681-711, September.
    • Handle: RePEc:kap:netspa:v:17:y:2017:i:3:d:10.1007_s11067-017-9340-7
    DOI: 10.1007/s11067-017-9340-7
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    References listed on IDEAS

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    3. Provoost, Jesper & Cats, Oded & Hoogendoorn, Serge, 2023. "Design and classification of tradable mobility credit schemes," Transport Policy, Elsevier, vol. 136(C), pages 59-69.
    4. Bruno De Borger & Amihai Glazer & Stef Proost, 2021. "Rational Drivers and the Choice Between Congestion Tolls and Tradeable Permits: A Political Economy Model," CESifo Working Paper Series 8821, CESifo.
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    8. Ravi Seshadri & André de Palma & Moshe Ben-Akiva, 2021. "Congestion Tolling−Dollars versus Tokens: Within-day Dynamics," THEMA Working Papers 2021-12, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
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