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Partial peak-load pricing of a transportation bottleneck with homogeneous and heterogeneous values of time

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  • Braid, Ralph M.

Abstract

The first-best solution for a transportation bottleneck is to impose a first-best peak-load toll that varies continuously over time, reaching its maximum value at the most desirable crossing time. This eliminates all wasteful queueing. With homogeneous values of time, the private costs of consumers are unchanged, but the large maximum value of the first-best toll may make it politically infeasible. In this paper, I consider continuously time-varying partial peak-load tolls that have a much lower maximum value, but which still achieve a large fraction of the efficiency gain of the first-best toll. With heterogeneous values of time, a partial peak-load toll can leave all consumers with unchanged or decreased private costs even when the first-best toll does not do this.

Suggested Citation

  • Braid, Ralph M., 2018. "Partial peak-load pricing of a transportation bottleneck with homogeneous and heterogeneous values of time," Economics of Transportation, Elsevier, vol. 16(C), pages 29-41.
    • Handle: RePEc:eee:ecotra:v:16:y:2018:i:c:p:29-41
    DOI: 10.1016/j.ecotra.2018.08.001
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    More about this item

    Keywords

    Bottleneck; Bridge; Peak-load toll; Time-varying toll;
    All these keywords.

    JEL classification:

    • R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise
    • R48 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government Pricing and Policy

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