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Coarse Tolling with Heterogeneous Preferences

Author

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  • Vincent A.C. van den Berg

    (VU University Amsterdam)

Abstract
This paper resulted in a publication in Transportation Research Part B: Methodological 64, 1-23. This paper analyses optimal coarse tolling of congestion under heterogeneous preferences, and especially the welfare and distributional effects. With coarse tolling, the toll equals a fixed value during the centre of the peak; outside this period, it is zero. This paper separately investigates three dimensions of heterogeneity. With the first, all values of time and schedule delay vary in fixed proportions ,and this heterogeneity may stem from income differences. The second has differences in the flexibility of users when to arrive. The third captures differences in willingness to arrive before or after the preferred arrival time. The paper uses three models of coarse tolling: the “Laih”, “ADL”, and “Braking” model. All three dimensions affect the welfare gain of coarse tolling. In the Laih model, the generalised price with coarse tolling is always in between the no -toll and first – best one. In the other models, this is not the case and distributional effects may be non-monotonic and very different from the first - best toll’s effects. In the Braking model, the bottleneck capacity goes unused for some time during the tolled period; compared with in the Laih model, this raises total cost, and it is most harmful for users with low values and difficulty to arrive late: e.g. low –income users with a strict work start time or a trip to the doctor.

Suggested Citation

  • Vincent A.C. van den Berg, 2013. "Coarse Tolling with Heterogeneous Preferences," Tinbergen Institute Discussion Papers 13-120/VIII, Tinbergen Institute, revised 20 Dec 2013.
    • Handle: RePEc:tin:wpaper:20130120
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    File URL: https://papers.tinbergen.nl/13120.pdf
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    References listed on IDEAS

    as
    1. Robin Lindsey, C. & van den Berg, Vincent A.C. & Verhoef, Erik T., 2012. "Step tolling with bottleneck queuing congestion," Journal of Urban Economics, Elsevier, vol. 72(1), pages 46-59.
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    16. van den Berg, Vincent & Verhoef, Erik T., 2011. "Winning or losing from dynamic bottleneck congestion pricing?: The distributional effects of road pricing with heterogeneity in values of time and schedule delay," Journal of Public Economics, Elsevier, vol. 95(7-8), pages 983-992, August.
    17. Paul Koster & Hans Koster, 2013. "Commuters' Preferences for Fast and Reliable Travel," Tinbergen Institute Discussion Papers 13-075/VIII, Tinbergen Institute, revised 30 Apr 2015.
    18. van den Berg, Vincent & Verhoef, Erik T., 2011. "Winning or losing from dynamic bottleneck congestion pricing?," Journal of Public Economics, Elsevier, vol. 95(7), pages 983-992.
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    Citations

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    Cited by:

    1. Li, Zhi-Chun & Lam, William H.K. & Wong, S.C., 2014. "Bottleneck model revisited: An activity-based perspective," Transportation Research Part B: Methodological, Elsevier, vol. 68(C), pages 262-287.
    2. Chen, Hongyu & Liu, Yang & Nie, Yu (Marco), 2015. "Solving the step-tolled bottleneck model with general user heterogeneity," Transportation Research Part B: Methodological, Elsevier, vol. 81(P1), pages 210-229.
    3. Chen, Hongyu & Nie, Yu (Marco) & Yin, Yafeng, 2015. "Optimal multi-step toll design under general user heterogeneity," Transportation Research Part B: Methodological, Elsevier, vol. 81(P3), pages 775-793.
    4. Yu, Xiaojuan & van den Berg, Vincent A.C. & Verhoef, Erik T., 2019. "Carpooling with heterogeneous users in the bottleneck model," Transportation Research Part B: Methodological, Elsevier, vol. 127(C), pages 178-200.
    5. Li, Zhi-Chun & Lam, William H.K. & Wong, S.C., 2017. "Step tolling in an activity-based bottleneck model," Transportation Research Part B: Methodological, Elsevier, vol. 101(C), pages 306-334.
    6. Jiang, Changmin & Zhang, Anming, 2015. "Airport congestion pricing and terminal investment: Effects of terminal congestion, passenger types, and concessionsAuthor-Name: Wan, Yulai," Transportation Research Part B: Methodological, Elsevier, vol. 82(C), pages 91-113.
    7. Vincent A.C. van den Berg & Erik T. Verhoef, 2015. "Robot Cars and Dynamic Bottleneck Congestion: The Effects on Capacity, Value of Time and Preference Heterogeneity," Tinbergen Institute Discussion Papers 15-062/VIII, Tinbergen Institute, revised 11 Jul 2016.
    8. Xu, Da & Guo, Xiaolei & Zhang, Guoqing, 2019. "Constrained optimization for bottleneck coarse tolling," Transportation Research Part B: Methodological, Elsevier, vol. 128(C), pages 1-22.
    9. Juan Gomez & Anestis Papanikolaou & José Manuel Vassallo, 2017. "Users’ perceptions and willingness to pay in interurban toll roads: identifying differences across regions from a nationwide survey in Spain," Transportation, Springer, vol. 44(3), pages 449-474, May.
    10. van den Berg, Vincent A.C. & Verhoef, Erik T., 2016. "Autonomous cars and dynamic bottleneck congestion: The effects on capacity, value of time and preference heterogeneity," Transportation Research Part B: Methodological, Elsevier, vol. 94(C), pages 43-60.
    11. Ren-Yong Guo & Hai Yang & Hai-Jun Huang, 2018. "Are We Really Solving the Dynamic Traffic Equilibrium Problem with a Departure Time Choice?," Transportation Science, INFORMS, vol. 52(3), pages 603-620, June.
    12. Ortega, Alejandro & Vassallo, José Manuel & Pérez, Juan Ignacio, 2021. "Modelling some equality and social welfare impacts of road tolling under conditions of traffic uncertainty," Research in Transportation Economics, Elsevier, vol. 88(C).
    13. Fu, Xinying & van den Berg, Vincent A.C. & Verhoef, Erik T., 2018. "Private road supply in networks with heterogeneous users," Transportation Research Part A: Policy and Practice, Elsevier, vol. 118(C), pages 430-443.
    14. Vincent van den Berg, "undated". "Self-financing roads under coarse tolling and heterogeneous preferences," Tinbergen Institute Discussion Papers 22-045/VIII, Tinbergen Institute.
    15. Xiaojuan Yu & Vincent A.C. van den Berg & Erik T. Verhoef, 2024. "Preference heterogeneity in a dynamic flow congestion model," Tinbergen Institute Discussion Papers 24-025/VIII, Tinbergen Institute.
    16. Li, Zhi-Chun & Huang, Hai-Jun & Yang, Hai, 2020. "Fifty years of the bottleneck model: A bibliometric review and future research directions," Transportation Research Part B: Methodological, Elsevier, vol. 139(C), pages 311-342.
    17. Guo, Ren-Yong & Yang, Hai & Huang, Hai-Jun & Li, Xinwei, 2018. "Day-to-day departure time choice under bounded rationality in the bottleneck model," Transportation Research Part B: Methodological, Elsevier, vol. 117(PB), pages 832-849.
    18. Jonathan D. Hall, 2024. "Inframarginal Travelers And Transportation Policy," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 65(3), pages 1519-1550, August.
    19. van den Berg, Vincent A.C., 2024. "Self-financing roads under coarse tolling and preference heterogeneity," Transportation Research Part B: Methodological, Elsevier, vol. 182(C).

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    More about this item

    Keywords

    Coarse tolling; heterogeneous preferences; distributional effects; bottleneck model; proportional heterogeneity;
    All these keywords.

    JEL classification:

    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise
    • R48 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government Pricing and Policy

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