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A Stochastic Model of Congestion Caused by Speed Differences

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  • Jan Rouwendal
  • Erik Verhoef
  • Piet Rietveld
  • Bert Zwart

Abstract

The authors study interaction on a two-lane road between the trips of two types of drivers who differ by their desired speeds. The difference in desired speeds causes congestion, because slow vehicles force fast vehicles to reduce their speed. Results for this type of congestion with respect to tolling are very different from those of the classic Pigou-Knight model, where the marginal external costs are an increasing function of the number of road users. In our model we find the opposite result: the marginal external costs of slow vehicles are a decreasing function of the number of slow vehicles. This leads to rather different policy recommendations. © The London School of Economics and the University of Bath 2002

Suggested Citation

  • Jan Rouwendal & Erik Verhoef & Piet Rietveld & Bert Zwart, 2002. "A Stochastic Model of Congestion Caused by Speed Differences," Journal of Transport Economics and Policy, University of Bath, vol. 36(3), pages 407-445, September.
    • Handle: RePEc:tpe:jtecpo:v:36:y:2002:i:3:p:407-445
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    References listed on IDEAS

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    1. Verhoef, Erik T. & Rouwendal, Jan & Rietveld, Piet, 1999. "Congestion Caused by Speed Differences," Journal of Urban Economics, Elsevier, vol. 45(3), pages 533-556, May.
    2. Arnott, Richard & de Palma, Andre & Lindsey, Robin, 1993. "A Structural Model of Peak-Period Congestion: A Traffic Bottleneck with Elastic Demand," American Economic Review, American Economic Association, vol. 83(1), pages 161-179, March.
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    Cited by:

    1. Andre De Palma & Moez Kilani & Robin Lindsey, 2006. "The Economics of Truck Toll Lanes," ERSA conference papers ersa06p896, European Regional Science Association.
    2. Jan Rouwendal, 2002. "Speed Choice, Car Following Theory and Congestion Tolling," Tinbergen Institute Discussion Papers 02-102/3, Tinbergen Institute.
    3. de Palma, André & Kilani, Moez & Lindsey, Robin, 2008. "The merits of separating cars and trucks," Journal of Urban Economics, Elsevier, vol. 64(2), pages 340-361, September.
    4. Cameron Hepburn, 2006. "Regulation by Prices, Quantities, or Both: A Review of Instrument Choice," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 22(2), pages 226-247, Summer.

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