Pricing and financing roads in transportation networks

Road pricing has two distinct objectives, to alleviate the congestion problem, and to generate revenue for transportation infrastructure financing. Accordingly, road pricing studies can be roughly classified into two branches with overlapping, one on congestion pricing and the other on toll roads. This thesis contributes to both branches of road pricing studies.;Congestion pricing with user heterogeneity in value of time (VOT) is studied. For a traffic network with user heterogeneity in VOT and fixed demand, there are two different objectives for network optimization, i.e. to minimize system time and to minimize system cost, which naturally gives rise to a bi-objective minimization problem. This thesis proves that any Pareto optimum of this bi-objective problem can be decentralized into multi-class user equilibrium by positive anonymous link tolls. The system performance gap when optimized by the two different criteria is quantified and a theoretical upper bound of the gap is established.;Congestion pricing proposals are frequently declined due to public opposition in the real world, and refunding the toll revenue to the users is a possible way to solve this problem. This thesis investigates Pareto-improving revenue refunding schemes which make every user better off compared with the situation without congestion pricing. Both the fixed demand and the elastic demand cases are studied. For the fixed demand case, a sufficient condition for the existence of Pareto-improving refunding schemes is established. For the elastic demand case, a Pareto-improving revenue refunding scheme is designed such that traffic equilibrium will not be changed. It is proved that, under some technical conditions, the Pareto-improving revenue refunding scheme would not use up the total toll revenue. In a general network, the revenue margin consists of two parts corresponding to the two effects of congestion pricing, i.e. demand depression and user rerouting.;Private provision of public roads through build-operate-transfer (BOT) contracts is increasing around the world. This thesis studies optimal BOT contracts, which maximize social welfare and allow the private sector an acceptable profit, and investigates how to reach optimal BOT contracts either through bilateral negotiations or through competitive auctions. The study on private toll roads is then extended to heterogeneous users with different VOT. The distinctions between the private and the public sectors' choices on toll charge, road capacity and volume/capacity ratio are examined, which give policy implications on how to set proper government regulations when user heterogeneity in VOT is taken into consideration.