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Determining Fair Ticket Prices in Public Transport by Solving a Cost Allocation Problem

In: Modeling, Simulation and Optimization of Complex Processes

Author

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  • Ralf Borndörfer

    (Zuse Institute Berlin (ZIB))

  • Nam-Dũng Hoàng

    (Zuse Institute Berlin (ZIB))

Abstract

Ticket pricing in public transport usually takes a welfare maximization point of view. Such an approach, however, does not consider fairness in the sense that users of a shared infrastructure should pay for the costs that they generate. We propose an ansatz to determine fair ticket prices that combines concepts from cooperative game theory and integer programming. An application to pricing railway tickets for the intercity network of the Netherlands is presented. The results demonstrate that prices that are much fairer than standard ones can be computed in this way.

Suggested Citation

  • Ralf Borndörfer & Nam-Dũng Hoàng, 2012. "Determining Fair Ticket Prices in Public Transport by Solving a Cost Allocation Problem," Springer Books, in: Hans Georg Bock & Xuan Phu Hoang & Rolf Rannacher & Johannes P. Schlöder (ed.), Modeling, Simulation and Optimization of Complex Processes, edition 127, pages 53-63, Springer.
    • Handle: RePEc:spr:sprchp:978-3-642-25707-0_5
    DOI: 10.1007/978-3-642-25707-0_5
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