IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v14y2022i7p4201-d785133.html
   My bibliography  Save this article

A Bus Subsidy Scheme Design Model Considering Competition between Bus Companies

Author

Listed:
  • Shiqian Ji

    (School of Intelligent Systems Engineering, Sun Yat-sen University, Guangzhou 510006, China
    Guangdong Provincial Key Laboratory of Intelligent Transportation System, Guangzhou 510006, China)

  • Jiaming Zhong

    (School of Intelligent Systems Engineering, Sun Yat-sen University, Guangzhou 510006, China
    Guangdong Provincial Key Laboratory of Intelligent Transportation System, Guangzhou 510006, China)

  • Zhaocheng He

    (School of Intelligent Systems Engineering, Sun Yat-sen University, Guangzhou 510006, China
    Guangdong Provincial Key Laboratory of Intelligent Transportation System, Guangzhou 510006, China
    Peng Cheng Laboratory, Shenzhen 518000, China)

Abstract

The competition between bus companies plays an important role in the effects of bus subsidy schemes for operation-sharing networks. This paper presents a bi-level programming model considering the competition to design bus subsidy schemes. In the upper sub-model, a subsidy scheme is given with the target of minimizing the total social costs (TSC). Further, in the lower sub-model, each bus company competes with other companies under the subsidy scheme. The competition is portrayed as a non-cooperative game where each company changes the departure frequency of their lines separately to obtain the maximum profit. The subsidy schemes can minimize the TSC when all bus companies pursue the maximum profit. A specific approach combining genetic algorithm and best response dynamics is proposed to solve the model. To validate the constructed model, a real-world case study is conducted in Guangzhou. From the results, as the scheme is implemented, the bus companies will be inspired to increase the line departure frequency, leading to a reduction of the passenger waiting time and performing a higher level of service. The TSC are reduced by 28.6%, among which the total waiting time costs are reduced by 43.0%. The model can guide bus subsidy scheme design for operation-sharing bus networks.

Suggested Citation

  • Shiqian Ji & Jiaming Zhong & Zhaocheng He, 2022. "A Bus Subsidy Scheme Design Model Considering Competition between Bus Companies," Sustainability, MDPI, vol. 14(7), pages 1-19, April.
  • Handle: RePEc:gam:jsusta:v:14:y:2022:i:7:p:4201-:d:785133
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/14/7/4201/pdf
    Download Restriction: no

    File URL: https://www.mdpi.com/2071-1050/14/7/4201/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Feifei Qin & Xiaoning Zhang, 2015. "Designing an Optimal Subsidy Scheme to Reduce Emissions for a Competitive Urban Transport Market," Sustainability, MDPI, vol. 7(9), pages 1-16, August.
    2. Spiess, Heinz & Florian, Michael, 1989. "Optimal strategies: A new assignment model for transit networks," Transportation Research Part B: Methodological, Elsevier, vol. 23(2), pages 83-102, April.
    3. Yves Croissant & William Roy & Joan Canton, 2013. "Reducing urban public transport costs by tendering lots: a panel data estimation," Applied Economics, Taylor & Francis Journals, vol. 45(26), pages 3711-3722, September.
    4. Glaister, Stephen & Lewis, Davis, 1978. "An integrated fares policy for transport in London," Journal of Public Economics, Elsevier, vol. 9(3), pages 341-355, June.
    5. Zubieta, Lourdes, 1998. "A network equilibrium model for oligopolistic competition in city bus services," Transportation Research Part B: Methodological, Elsevier, vol. 32(6), pages 413-422, August.
    6. Yunqiang Xue & Hongzhi Guan & Jonathan Corey & Heng Wei & Hai Yan, 2017. "Quantifying a Financially Sustainable Strategy of Public Transport: Private Capital Investment Considering Passenger Value," Sustainability, MDPI, vol. 9(2), pages 1-20, February.
    7. Wenqian Zou & Meichen Yu & Shoshi MIZOKAMI, 2019. "Mechanism Design for an Incentive Subsidy Scheme for Bus Transport," Sustainability, MDPI, vol. 11(6), pages 1-13, March.
    8. Zhou, Jing & Lam, William H.K. & Heydecker, Benjamin G., 2005. "The generalized Nash equilibrium model for oligopolistic transit market with elastic demand," Transportation Research Part B: Methodological, Elsevier, vol. 39(6), pages 519-544, July.
    9. Elżbieta Macioszek & Agata Kurek, 2021. "The Analysis of the Factors Determining the Choice of Park and Ride Facility Using a Multinomial Logit Model," Energies, MDPI, vol. 14(1), pages 1-33, January.
    10. Hassold, Stephan & Ceder, Avishai (Avi), 2014. "Public transport vehicle scheduling featuring multiple vehicle types," Transportation Research Part B: Methodological, Elsevier, vol. 67(C), pages 129-143.
    11. Fisk, C. S., 1984. "Game theory and transportation systems modelling," Transportation Research Part B: Methodological, Elsevier, vol. 18(4-5), pages 301-313.
    12. Hensher, David A. & Houghton, Erne, 2004. "Performance-based quality contracts for the bus sector: delivering social and commercial value for money," Transportation Research Part B: Methodological, Elsevier, vol. 38(2), pages 123-146, February.
    13. Claude Chriqui & Pierre Robillard, 1975. "Common Bus Lines," Transportation Science, INFORMS, vol. 9(2), pages 115-121, May.
    14. Songyot Kitthamkesorn & Anthony Chen & Sathaporn Opasanon & Suwicha Jaita, 2021. "A P-Hub Location Problem for Determining Park-and-Ride Facility Locations with the Weibit-Based Choice Model," Sustainability, MDPI, vol. 13(14), pages 1-16, July.
    15. Hensher, David A. & Ho, Chinh & Knowles, Louise, 2016. "Efficient contracting and incentive agreements between regulators and bus operators: The influence of risk preferences of contracting agents on contract choice," Transportation Research Part A: Policy and Practice, Elsevier, vol. 87(C), pages 22-40.
    16. Delle Site, Paolo & Filippi, Francesco, 1998. "Service optimization for bus corridors with short-turn strategies and variable vehicle size," Transportation Research Part A: Policy and Practice, Elsevier, vol. 32(1), pages 19-38, January.
    17. Hensher, David A. & Stanley, John, 2003. "Performance-based quality contracts in bus service provision," Transportation Research Part A: Policy and Practice, Elsevier, vol. 37(6), pages 519-538, July.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ling, Shuai & Jia, Ning & Ma, Shoufeng & Lan, Yanfei & Hu, Wandi, 2019. "An incentive mechanism design for bus subsidy based on the route service level," Transportation Research Part A: Policy and Practice, Elsevier, vol. 119(C), pages 271-283.
    2. Hernández, Daniel & Muñoz, Juan Carlos & Giesen, Ricardo & Delgado, Felipe, 2015. "Analysis of real-time control strategies in a corridor with multiple bus services," Transportation Research Part B: Methodological, Elsevier, vol. 78(C), pages 83-105.
    3. Preston, John, 2008. "Competition in transit markets," Research in Transportation Economics, Elsevier, vol. 23(1), pages 75-84, January.
    4. Liu, Qi & Chow, Joseph Y.J., 2022. "Efficient and stable data-sharing in a public transit oligopoly as a coopetitive game," Transportation Research Part B: Methodological, Elsevier, vol. 163(C), pages 64-87.
    5. Sheng, Dian & Meng, Qiang, 2020. "Public bus service contracting: A critical review and future research opportunities," Research in Transportation Economics, Elsevier, vol. 83(C).
    6. Wenqian Zou & Meichen Yu & Shoshi MIZOKAMI, 2019. "Mechanism Design for an Incentive Subsidy Scheme for Bus Transport," Sustainability, MDPI, vol. 11(6), pages 1-13, March.
    7. Canıtez, Fatih & Çelebi, Dilay & Deveci, Muhammet & Kuvvetli, Yusuf, 2019. "Selecting an optimal contractual payment model for Istanbul's public bus operators using non-linear mathematical programming," Research in Transportation Economics, Elsevier, vol. 76(C).
    8. Chunqin Zhang & Yuting Hu & Anning Ni & Hongwei Li, 2019. "Compensation Scheme for Self-Employed Bus Service Requisitions in Urban–Rural Passenger Transport," Sustainability, MDPI, vol. 11(18), pages 1-20, September.
    9. Tong, C.O. & Wong, S.C., 1998. "A stochastic transit assignment model using a dynamic schedule-based network," Transportation Research Part B: Methodological, Elsevier, vol. 33(2), pages 107-121, April.
    10. Xu, Zhandong & Xie, Jun & Liu, Xiaobo & Nie, Yu (Marco), 2020. "Hyperpath-based algorithms for the transit equilibrium assignment problem," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 143(C).
    11. Wu, Di & Yin, Yafeng & Lawphongpanich, Siriphong, 2011. "Pareto-improving congestion pricing on multimodal transportation networks," European Journal of Operational Research, Elsevier, vol. 210(3), pages 660-669, May.
    12. Codina, Esteve & Rosell, Francisca, 2017. "A heuristic method for a congested capacitated transit assignment model with strategies," Transportation Research Part B: Methodological, Elsevier, vol. 106(C), pages 293-320.
    13. Nayan, Ashish & Wang, David Z.W., 2017. "Optimal bus transit route packaging in a privatized contracting regime," Transportation Research Part A: Policy and Practice, Elsevier, vol. 97(C), pages 146-157.
    14. Wang, David Z.W. & Nayan, Ashish & Szeto, W.Y., 2018. "Optimal bus service design with limited stop services in a travel corridor," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 111(C), pages 70-86.
    15. Roberto Cominetti & José Correa, 2001. "Common-Lines and Passenger Assignment in Congested Transit Networks," Transportation Science, INFORMS, vol. 35(3), pages 250-267, August.
    16. Belgacem Bouzaïene-Ayari & Michel Gendreau & Sang Nguyen, 2001. "Modeling Bus Stops in Transit Networks: A Survey and New Formulations," Transportation Science, INFORMS, vol. 35(3), pages 304-321, August.
    17. Bing-Zheng Liu & Ying-En Ge & Kai Cao & Xi Jiang & Lingyun Meng & Ding Liu & Yunfeng Gao, 2017. "Optimizing a desirable fare structure for a bus-subway corridor," PLOS ONE, Public Library of Science, vol. 12(10), pages 1-21, October.
    18. Godachevich, Javiera & Tirachini, Alejandro, 2021. "Does the measured performance of bus operators depend on the index chosen to assess reliability in contracts? An analysis of bus headway variability," Research in Transportation Economics, Elsevier, vol. 90(C).
    19. dell'Olio, Luigi & Ibeas, Angel & Cecin, Patricia, 2011. "The quality of service desired by public transport users," Transport Policy, Elsevier, vol. 18(1), pages 217-227, January.
    20. Chavis, Celeste & Daganzo, Carlos F., 2013. "Analyzing the structure of informal transit: The evening commute problem," Research in Transportation Economics, Elsevier, vol. 39(1), pages 277-284.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:14:y:2022:i:7:p:4201-:d:785133. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.