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A bi-level model of the relationship between transport and residential location

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  • Chang, Justin Sueun
  • Mackett, Roger Laurence

Abstract

This paper explores a bid-rent network equilibrium model which represents the relationship between transport and residential location. The relationship is examined in terms of the competition of decision-makers for locations. The model discusses difficulties in addressing the characteristics of locations, particularly heterogeneity and indivisibility. A hedonic interpretation is included as a way to resolve these challenges. The model investigates the process in which households make their decisions. This process is shown as an n-player non-cooperative game, following the Nash equilibrium for this game, which is defined as well. The game is accompanied by the systematic interactions between transport and land-use. A mutual adjustment process represents these interactions. The three components are structured by a bi-level mathematical program. The final formulation is interpreted as an oligopolistic Cournot game of which consequence is an approximation of the n-player non-cooperative game. The functional relationship between the decision variables of the upper and the lower levels of the bi-level program produces endogenously-determined transport impedance and locational attractiveness. The endogenous network performance indices of the model are expected to overcome the lack of a realistic network equilibrium description in the existing models. A path-based heuristic algorithm and a simple numerical example are presented. Finally, some concluding remarks are given.

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  • Chang, Justin Sueun & Mackett, Roger Laurence, 2006. "A bi-level model of the relationship between transport and residential location," Transportation Research Part B: Methodological, Elsevier, vol. 40(2), pages 123-146, February.
    • Handle: RePEc:eee:transb:v:40:y:2006:i:2:p:123-146
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    3. Mahyar Amirgholy & Hojjat Rezaeestakhruie & Hossain Poorzahedy, 2015. "Multi-objective cordon price design to control long run adverse traffic effects in large urban areas," Netnomics, Springer, vol. 16(1), pages 1-52, August.
    4. Ma, Xiaosu & Lo, Hong K., 2012. "Modeling transport management and land use over time," Transportation Research Part B: Methodological, Elsevier, vol. 46(6), pages 687-709.
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    6. Peng, Ya-Ting & Li, Zhi-Chun & Choi, Keechoo, 2017. "Transit-oriented development in an urban rail transportation corridor," Transportation Research Part B: Methodological, Elsevier, vol. 103(C), pages 269-290.
    7. Ng, Ka Fai & Lo, Hong K., 2017. "On joint railway and housing development: Housing-led versus railway-led schemes," Transportation Research Part B: Methodological, Elsevier, vol. 106(C), pages 464-488.
    8. Justin S. Chang, 2007. "A demonstrative application of the bid-rent network equilibrium model," Transportation Planning and Technology, Taylor & Francis Journals, vol. 32(1), pages 27-57, May.
    9. Li, Tongfei & Sun, Huijun & Wu, Jianjun & Ge, Ying-en, 2017. "Optimal toll of new highway in the equilibrium framework of heterogeneous households' residential location choice," Transportation Research Part A: Policy and Practice, Elsevier, vol. 105(C), pages 123-137.
    10. Vincent Viguié, 2015. "Cross-commuting and housing prices in a polycentric modeling of cities," Policy Papers 2015.03, FAERE - French Association of Environmental and Resource Economists.
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