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Modeling heterogeneous risk-taking behavior in route choice: A stochastic dominance approach

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  • Wu, Xing
  • (Marco) Nie, Yu

Abstract

This paper proposes a unified approach to modeling heterogonous risk-taking behavior in route choice based on the theory of stochastic dominance (SD). Specifically, the first-, second-, and third-order stochastic dominance (FSD, SSD, TSD) are respectively linked to insatiability, risk-aversion and ruin-aversion within the framework of utility maximization. The paths that may be selected by travelers of different risk-taking preferences can be obtained from the corresponding SD-admissible paths, which can be generated using general dynamic programming. This paper also analyzes the relationship between the SD-based approach and other route choice models that consider risk-taking behavior. These route choice models employ a variety of reliability indexes, which often make the problem of finding optimal paths intractable. We show that the optimal paths with respect to these reliability indexes often belong to one of the three SD-admissible path sets. This finding offers not only an interpretation of risk-taking behavior consistent with the SD theory for these route choice models, but also a unified and computationally viable solution approach through SD-admissible path sets, which are usually small and can be generated without having to enumerate all paths. A generic label-correcting algorithm is proposed to generate FSD-, SSD-, and TSD-admissible paths, and numerical experiments are conducted to test the algorithm and to verify the analytical results.

Suggested Citation

  • Wu, Xing & (Marco) Nie, Yu, 2011. "Modeling heterogeneous risk-taking behavior in route choice: A stochastic dominance approach," Transportation Research Part A: Policy and Practice, Elsevier, vol. 45(9), pages 896-915, November.
  • Handle: RePEc:eee:transa:v:45:y:2011:i:9:p:896-915
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    References listed on IDEAS

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    Cited by:

    1. repec:eee:transb:v:104:y:2017:i:c:p:501-521 is not listed on IDEAS
    2. Chen, Bi Yu & Lam, William H.K. & Sumalee, Agachai & Li, Qingquan & Li, Zhi-Chun, 2012. "Vulnerability analysis for large-scale and congested road networks with demand uncertainty," Transportation Research Part A: Policy and Practice, Elsevier, vol. 46(3), pages 501-516.
    3. Wu, Xing, 2015. "Study on mean-standard deviation shortest path problem in stochastic and time-dependent networks: A stochastic dominance based approach," Transportation Research Part B: Methodological, Elsevier, vol. 80(C), pages 275-290.
    4. Chen, Bi Yu & Li, Qingquan & Lam, William H.K., 2016. "Finding the k reliable shortest paths under travel time uncertainty," Transportation Research Part B: Methodological, Elsevier, vol. 94(C), pages 189-203.
    5. Xu, Xiangdong & Chen, Anthony & Cheng, Lin & Yang, Chao, 2017. "A link-based mean-excess traffic equilibrium model under uncertainty," Transportation Research Part B: Methodological, Elsevier, vol. 95(C), pages 53-75.
    6. repec:eee:ecotra:v:11-12:y:2017:i::p:1-14 is not listed on IDEAS
    7. Uchida, Kenetsu, 2014. "Estimating the value of travel time and of travel time reliability in road networks," Transportation Research Part B: Methodological, Elsevier, vol. 66(C), pages 129-147.
    8. Yang, Lixing & Zhou, Xuesong, 2017. "Optimizing on-time arrival probability and percentile travel time for elementary path finding in time-dependent transportation networks: Linear mixed integer programming reformulations," Transportation Research Part B: Methodological, Elsevier, vol. 96(C), pages 68-91.
    9. Zhang, Yuli & Shen, Zuo-Jun Max & Song, Shiji, 2016. "Parametric search for the bi-attribute concave shortest path problem," Transportation Research Part B: Methodological, Elsevier, vol. 94(C), pages 150-168.
    10. Tan, Zhijia & Yang, Hai & Guo, Renyong, 2014. "Pareto efficiency of reliability-based traffic equilibria and risk-taking behavior of travelers," Transportation Research Part B: Methodological, Elsevier, vol. 66(C), pages 16-31.
    11. Nie, Yu (Marco) & Wu, Xing & Dillenburg, John F. & Nelson, Peter C., 2012. "Reliable route guidance: A case study from Chicago," Transportation Research Part A: Policy and Practice, Elsevier, vol. 46(2), pages 403-419.

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