Micro-foundations of Congestion and Pricing: A Game Theory Perspective
This paper develops congestion theory and congestion pricing theory from its microfoundations, the interaction of two or more vehicles. Using game theory, with a two-player game it is shown that the emergence of congestion depends on the players-relative valuations of early arrival, late arrival, and journey delay. Congestion pricing can be used as a cooperation mechanism to minimize total costs (if returned to the players). The analysis is then extended to the case of the three-player game, which illustrates congestion as a negative externality imposed on players who do not themselves contribute to it.
|Date of creation:||2005|
|Publication status:||Published in Transportation Research part A Volume 39, Issues 7-9 , August-November 2005, Pages 691-704.|
|Contact details of provider:|| Postal: Dept. of Civil Engineering, 500 Pillsbury Drive SE, Minneapolis, MN 55455|
Phone: +01 (612) 625-6354
Fax: +01 (612) 626-7750
Web page: http://nexus.umn.edu
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- David Levinson, 1999. "Tolling at a Frontier: A Game Theoretic Analysis," Working Papers 199904, University of Minnesota: Nexus Research Group.
- David Levinson, 2000. "Revenue Choice on a Serial Network," Working Papers 200001, University of Minnesota: Nexus Research Group.
- Arnott, Richard & de Palma, Andre & Lindsey, Robin, 1990.
"Economics of a bottleneck,"
Journal of Urban Economics,
Elsevier, vol. 27(1), pages 111-130, January.
- Richard Arnott & Andre de Palma & Robin Lindsey, 1985. "Economics of a Bottleneck," Working Papers 636, Queen's University, Department of Economics.
- Arnott, R. & De Palma, A. & Lindseyt, R., 1995. "Recent Developments in the Bottleneck Model," Papers 9523, Paris X - Nanterre, U.F.R. de Sc. Ec. Gest. Maths Infor..
- Richard Arnott & Andre de Palma & Robin Lindsey, 1995. "Recent Developments in the Bottleneck Model," Boston College Working Papers in Economics 305., Boston College Department of Economics.
- Small, Kenneth A, 1982. "The Scheduling of Consumer Activities: Work Trips," American Economic Review, American Economic Association, vol. 72(3), pages 467-479, June.
- Martin J. Osborne & Ariel Rubinstein, 1994. "A Course in Game Theory," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262650401, January.
- Martin J Osborne & Ariel Rubinstein, 2009. "A Course in Game Theory," Levine's Bibliography 814577000000000225, UCLA Department of Economics.
- S.C. Littlechild & G.F. Thompson, 1977. "Aircraft Landing Fees: A Game Theory Approach," Bell Journal of Economics, The RAND Corporation, vol. 8(1), pages 186-204, Spring.
- F. H. Knight, 1924. "Some Fallacies in the Interpretation of Social Cost," The Quarterly Journal of Economics, Oxford University Press, vol. 38(4), pages 582-606.
- C. Robin Lindsey & Erik T. Verhoef, 2000. "Traffic Congestion and Congestion Pricing," Tinbergen Institute Discussion Papers 00-101/3, Tinbergen Institute.
- Mohring, Herbert, 1970. "The Peak Load Problem with Increasing Returns and Pricing Constraints," American Economic Review, American Economic Association, vol. 60(4), pages 693-705, September.
- 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. Full references (including those not matched with items on IDEAS)