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A Stochastic Model of Congestion caused by Speed Differences

Author

Listed:
  • Jan Rouwendal

    (Wageningen University)

  • Erik T. Verhoef
  • Piet Rietveld

    (Vrije Universiteit Amsterdam)

  • Bert Zwart

    (Eindhoven University of Technology)

Abstract

We study interaction between the trips of two types of drivers on a two-lane road who differ by their desired speeds. The difference in desired speeds causes congestion, because slow drivers force fast drivers to reduce their speed. An interesting aspect of this type of congestion is that results with respect to tolling are very different from those of the classical 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 drivers are a decreasing function of the number of slow drivers. This leads to rather different policy recommendations. In many situations either laissez faire (no tolling or traffic restrictions) or prohibition of slow drivers to enter the road is in practice (i.e. taking into account costs associated with tolling) the optimal policy. This conclusion hardly changes if the possibility of overtaking is introduced into the model.

Suggested Citation

  • Jan Rouwendal & Erik T. Verhoef & Piet Rietveld & Bert Zwart, 2000. "A Stochastic Model of Congestion caused by Speed Differences," Tinbergen Institute Discussion Papers 00-091/3, Tinbergen Institute.
    • Handle: RePEc:tin:wpaper:20000091
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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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    Keywords

    Congestion; Road Pricing;

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