Bottleneck Congestion and Modal Split Revisited
The paper examines the efficiency of alternative road pricing schemes when an alternative railroad service is available. The paper uses a model, developed by Tabuchi (1993), in which road transport presents a bottleneck congestion technology while railroad transport shows economies of scale with respect to the number of train users. The competition between the two modes is assumed to be on cost basis only. It is found that if the railroad fare is set equal to the average cost, the relative efficiency of the regimes depends on parameters' values. The numerical simulation shows that the fine toll regime is generally to be preferred to the alternative regimes but when the fixed railroad cost is large enough so that the inefficient exploitation of the scale economies is less than compensated by the toll revenue.
|Date of creation:||Jan 1999|
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- Richard Arnott & Andre de Palma & Robin Lindsey, 1985.
"Economics of a Bottleneck,"
636, Queen's University, Department of Economics.
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- Richard Arnott & Marvin Kraus, 2003. "Transport Economics," Boston College Working Papers in Economics 553, Boston College Department of Economics.
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- Small, Kenneth A., 1983. "The incidence of congestion tolls on urban highways," Journal of Urban Economics, Elsevier, vol. 13(1), pages 90-111, January.
- Vickrey, William S, 1969. "Congestion Theory and Transport Investment," American Economic Review, American Economic Association, vol. 59(2), pages 251-60, May.
- Richard Arnott, 1989. "Does Providing Information to Drivers Reduce Traffic Congestion?," Discussion Papers 864, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- Braid, Ralph M., 1996. "Peak-Load Pricing of a Transportation Route with an Unpriced Substitute," Journal of Urban Economics, Elsevier, vol. 40(2), pages 179-197, September.
- Arnott, R. & de Palma, A. & Lindsey, R., 1990. "Departure time and route choice for the morning commute," Transportation Research Part B: Methodological, Elsevier, vol. 24(3), pages 209-228, June.
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