Implications for the United States
Edited by Harry W. Richardson and Chang-Hee Christine Bae
Chapter 2: Profit-Maximising Transit in Combination with a Congestion Charge: An Inter-modal Equilibrium Model
2. Proﬁt-maximising transit in combination with a congestion charge: an inter-modal equilibrium model Michael G.H. Bell and Muanmas Wichiensin 1 INTRODUCTION Traﬃc congestion in urban areas is one of the most serious problems for both government and transport planners. Since a congestion charging scheme was ﬁrst introduced in Singapore more than 30 years ago, big cities like Seoul and Tokyo have considered such schemes, with London implementing congestion charging in 2003 (see reviews in Gómez-Ibáñez and Small, 1994; May and Milne, 2000). From this evidence, many studies have been made for the auto mode network in order to determine the optimal amount of the congestion charge (see, for example, Arnott and Small, 1994; Liu and McDonald, 1999). However, congestion charging aﬀects not only car drivers but also the users of alternative modes as well as decisions about whether or not to travel. Hence, a model which allows for variable demand as well as mode choice is required. In particular, cities considering congestion charging will normally have at least two transit modes (bus and train). These services are often provided by the private sector in some regulated way. In the UK, following bus privatisation in 1980, several studies have focused on the characteristics of the transit market. Some say that the market is contestable while others say the evidence is inconclusive or disputable (Gwilliam et al., 1985; Evans, 1991). Some say that the tendency is for operators to merge rather than for new entries into the...
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