AbstractThis paper deals with the following question associated with congestion pricing in a general network with either fixed or elastic travel demand: what is the maximum efficiency loss of a general second-best pricing scheme due to inexact marginal-cost pricing in comparison with the first-best pricing or system optimum case? A formal answer to this question is provided by establishing an inefficiency bound associated with a given road pricing scheme. An application of the methods is provided for the practical trial-and-error implementation of marginal-cost pricing with unknown demand functions.


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    Title :

    Bounding the efficiency of road pricing


    Contributors:
    Yang, Hai (author) / Xu, Wei (author) / Heydecker, Benjamin (author)


    Publication date :

    2009-05-30


    Size :

    19 pages




    Type of media :

    Article (Journal)


    Type of material :

    Electronic Resource


    Language :

    English




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