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Alternative High Occupancy/Toll Lane Pricing Strategies and their Effect on Market Share

Author

Listed:
  • Michael Janson
  • David Levinson

    (Nexus (Networks, Economics, and Urban Systems) Research Group, Department of Civil Engineering, University of Minnesota)

Abstract

High Occupancy/Toll (HOT) Lanes typically charge a varying to single occupant vehicles (SOVs), with the toll increasing during more congested periods. The toll is usually tied to time of day or to the density of vehicles in the HOT lane. The purpose of raising the toll with congestion is to discourage demand enough to maintain a high level of service (LOS) in the HOT lane. Janson and Levinson (2014) demonstrated that the HOT toll may act as a signal of downstream congestion (in both general purpose (GP) and HOT lanes), causing an increase in demand for the HOT lane, at least at lower prices. This paper builds off that research and explores alternative HOT lane pricing strategies, including the use of GP density as a factor in price to more accurately reflect the value of the HOT lane. In addition, the paper explores the potential effect these strategies would have on the HOT lane vehicle share through a partial equilibrium analysis. This analysis demonstrates the change in demand elasticity with price, showing the point at which drivers switch from a positive to negative elasticity.

Suggested Citation

  • Michael Janson & David Levinson, 2014. "Alternative High Occupancy/Toll Lane Pricing Strategies and their Effect on Market Share," Working Papers 000121, University of Minnesota: Nexus Research Group.
    • Handle: RePEc:nex:wpaper:alternativehotprices
    DOI: 10.1177/0361198118786637
    as

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    File URL: http://hdl.handle.net/11299/179825
    File Function: First version, 2014
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    File URL: https://libkey.io/10.1177/0361198118786637?utm_source=ideas
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    References listed on IDEAS

    as
    1. Carrion, Carlos & Levinson, David, 2012. "Value of travel time reliability: A review of current evidence," Transportation Research Part A: Policy and Practice, Elsevier, vol. 46(4), pages 720-741.
    2. Janson, Michael & Levinson, David, 2014. "HOT or not," Research in Transportation Economics, Elsevier, vol. 44(C), pages 21-32.
    3. Andrew Owen & David Levinson, 2013. "Incremental Accessibility Benefits and HOT Lane Subscription Choice," Working Papers 000114, University of Minnesota: Nexus Research Group.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Toll Roads; Road Pricing; Transportation Economics; Travel Behavior; Networks;
    All these keywords.

    JEL classification:

    • R40 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - General

    NEP fields

    This paper has been announced in the following NEP Reports:

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