Financing capacity in the bottleneck model

Article Abstract:

A study is conducted to determine the circumstances under which the marginal cost pricing of congestible facilities such as roads, telephone lines and swimming pools is acceptable. The analysis studies a situation where the time variation of the congestion charge is constrained and a common congestion charge must be applied to heterogeneous users since they are indistinct. The investigation is done in the context of Vickrey's bottleneck model of morning rush-hour auto congestion. Findings prove the feasibility of marginal cost pricing of a congestible facility despite the fact that users have different observationally indistinguishable characteristics when a wholly flexible toll is employed. However, marginal cost pricing is infeasible and a variant of Ramsey pricing is optimal if constraints on the time variation of the toll are present.

Facility management, Facilities management, Tolls

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Discomfort externalities and marginal cost transit fares

Article Abstract:

A feeder transit line cost model was used to analyze the costs of providing service to marginal users of public mass transportation. In mass transportation systems, costs from servicing marginal passengers arise from the delays created by marginal passengers on the system and the discomfort of passengers by crowding the system. The model was based on the assumption that passengers disliked standing, and it was used to analyze the qualitative properties of the marginal cost of fares. A rail rapid transit line and a bus line of the Massachusetts Bay Transportation Authority were used for research. Research results revealed two sources of fare gradations: a discomfort externality, which made fares slope upward; and a loading and unloading externality, which made fares slope downward.

Massachusetts, Transportation, Subways, Bus lines, Local transit, Massachusetts. Bay Transportation Authority

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The welfare gains from pricing road congestion using automatic vehicle identification and on-vehicle meters

Article Abstract:

The relative gains of different regimes for increasing auto tolls in urban areas are examined. The regimes include: a higher, optimized gas tax; an automatic vehicle identification (AVI) system which charges variable peak and off-peak tolls for entering various city zones; and a time-based metering system with variable peak and off-peak rates. None of the alternatives are perfect because an increased gas tax over-prices off-peak travel and AVI and time meters have implementation costs.

Economic aspects, Urban economics

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