Dynamic Usage Allocation and Pricing for Curb Space Operation

The importance of curbside management is quickly growing in a modernized urban setting. Dynamic allocation of curb space to different usages and dynamic pricing for those usages can help meet the growing demand for curb space more effectively and promote user turnover. To model curbside operations, we formulate a Stackelberg leader-follower game between a leader operating curbside spaces, who sets space allocation and pricing of each curbside usage, and multi-followers, one for each type of curbside usage, who accept the proposed prices or reject them in favor of outside options. The proposed model offers flexible adaptability to manage curb space usages characterized by high turnover rates, such as parking and ride-sourcing pickup and drop-off, alongside accommodating usages that require more permanent infrastructure allocation, such as micromobility stations. Furthermore, the proposed model is able to capture the sensitivity of users to both prices, which are determined solely by the operator, and the occupancy levels of the curb space, which are determined by the complex interactions between the curbside operator and the users. We model a Stackelberg leader-follower game as a bilevel nonlinear optimization problem and reconstruct the problem into a single-level convex program by applying the Karush-Kuhn-Tucker conditions, objective function transformation, and constraint linearization. Then, we develop a solution algorithm that leverages valid inequalities produced via Benders decomposition. We validate the practicability of the model and draw insights into curbside management using numerical experiments.