Suggested Citation:
Xiao, Feng Evan, Shikai Tang, Michael Zhang (2012) Credit-based Pricing for Multi-user Class Transportation Facilities. Institute of Transportation Studies, University of California, Davis, Research Report UCD-ITS-RR-12-26

This paper proposes an innovative arc-based credit (ABC) congestion pricing scheme to improve the system performance in a transportation network. By associating each arc with a positive or negative credit rate, the strategy can accomplish multiple planning goals, such as efficiency, fairness, and public acceptance simultaneously. We first demonstrate that on a one-origin or one-destination network, a pareto-improving, system-optimal and revenue-neutral credit scheme always exists and can be obtained by solving a set of linear equations. Recognizing that such a credit scheme may not exist in a multi-origin network, we then define the maximum-revenue problem with pareto-improving constrains (MRPI): find the maximum possible revenue collected by the credit scheme with optimal arc flows and non-increasing origin-destination (OD) travel costs. We discover that the dual of MRPI is equivalent to a typical Transportation Problem which, therefore, provides a simple way to calculate the revenue by just examining the dual problem. At the end of the paper, a numerical example with a small synthetic network is provided for the comparison of the credit scheme with other existing toll schemes in terms of OD travel disutilities.

Keywords: credit-based, self-sustainable, pareto-improving, revenue-neutral, no-toll equilibrium, system-optimal