Realizing Pareto-Improvement Of The Transportation Network With Tradable Credits

Traffic congestion has now been a common problem in many major cities in China. The traffic is the lifeblood of economic development, so solving traffic congestion problem is critical for each big city. Basically, solving the conflict between traffic supply and demand is the key to solve traffic congestion and congestion pricing is the commonly used method to solve the conflict between traffic supply and demand. The domestic and foreign researchers do put forward a series of congestion pricing strategies to alleviate congestion at present. However, these pricing strategies have their limitations in some aspects such as: increasing cost of travellers, unfairness, poor transparency, poor acceptation of public etc. The purpose of this paper is to provide a new scheme of congestion pricing based on tradable credits, which would solve the problems existing in previous researches. We will show some interesting findings both from the theoretical analysis and numerical examples.After reviewing the literature on congestion pricing at present, this paper presents a new pricing scheme. This paper consists of the following three parts:Firstly, the paper summarizes the theory of congestion pricing, tradable credit and pareto-improvement, which are the theoretical basis of the model established in this paper.Secondly, the paper constructs a model considering both fixed and elastic demands under user equilibrium. We demonstrate the existence and uniqueness of market price of credit under user equilibrium with the new toll and subsidy scheme. A numerical example is also provided to prove the feasibility of the model.Finally, the paper establishes a model of new pricing scheme from the aspect of fixed demand under system-optimum. We show that the market price of credit exists under system-optimum by using the new toll and subsidy scheme. Then, this paper establishes models on the network of one OD pair and single-origin respectively. We prove that the model can realize system-optimum, pareto-improvement and finalcial sustainability. At last, the paper establishes a model on a general network with multiple ODs. Three numerical examples are also provided to prove the feasibility of three types of models on three different series of network. At last, a counter-example is provided from the aspect of elastic demand under system-optimum in view of the new pricing scheme. The results show that the system-optimal, pareto-improving and revenue-neutral scheme does not exist.