First-best marginal cost toll for a traffic network with stochastic demand

First-best marginal cost pricing (MCP) in traffic networks has been extensively studied with the assumption of deterministic travel demand. However, this assumption may not be realistic as a transportation network is exposed to various uncertainties. This paper investigates MCP in a traffic network under stochastic travel demand. Cases of both fixed and elastic demand are considered. In the fixed demand case, travel demand is represented as a random variable, whereas in the elastic demand case, a pre-specified random variable is introduced into the demand function. The paper also considers a set of assumptions of traveler behavior. In the first case, it is assumed that the traveler considers only the mean travel time in the route choice decision (risk-neutral behavior), and in the second, both the mean and the variance of travel time are introduced into the route choice model (risk-averse behavior). A closed-form formulation of the true marginal cost toll for the stochastic network (SN-MCP) is derived from the variational inequality conditions of the system optimum and user equilibrium assignments. The key finding is that the calculation of the SN-MCP model cannot be made by simply substituting related terms in the original MCP model by their expected values. The paper provides a general function of SN-MCP and derives the closed-form SN-MCP formulation for specific cases with lognormal and normal stochastic travel demand. Four numerical examples are explored to compare network performance under the SN-MCP and other toll regimes.     

The impact of road pricing on housing prices: Preliminary evidence from Milan

Road pricing is increasingly used as an economic tool to decrease the burden of transport externalities. Following the examples of several cities worldwide, on 2nd January, 2008, the city of Milan introduced a charge for accessing the city centre with the aim of curbing air pollution and congestion. The aim of this paper is to evaluate empirically the effect of such a charge on the housing market. By applying a difference-in-differences methodology, I find empirical support for a decrease in housing prices in the coverage area.     

A translog cost function of the integrated air freight business: The case of FedEx and UPS

This paper analyzes the cost structure of the integrated air freight business by means of a translog cost function. This allows to extend knowledge on the supply side and to examine if strategies of integrators are consistent with cost structure. The cost function is based on quarterly time-series data from 1990 to 2010 for FedEx and UPS. A total and a variable model are estimated. In addition, a static as well as a dynamic approach is followed. We find that integrators exhibit strong scale and density economies in the short and the long term. This result is in line with the aggressive expansion and cooperation strategies pursued by integrators. Our results indicate that the concentration in the integrated air freight industry will continue: a concern for industry actors and regulatory agencies.     

A framework for estimating traffic emissions: The development of Passenger Car Emission Unit

In this study, we develop a Passenger Car Emission Unit (PCEU) framework for estimating traffic emissions. The idea is analogous to the use of Passenger Car Unit (PCU) for modeling the congestion effect of different vehicle types. In this approach, we integrate emission modeling and cost evaluation. Different emissions, typically speed-dependent, are integrated as an overall cost via their corresponding external costs. We then develop a normalization procedure to obtain a general trend that is applicable for all vehicle types, which is used to derive a standard cost curve. Different vehicle types with different emission standards are then mapped to this standard cost curve through their corresponding PCEUs that are to be calibrated. Once the standard cost curve and PCEUs have been calibrated, to estimate the overall cost of emission for a particular vehicle, we only need to multiply the corresponding PCEU of that vehicle type to the standard cost curve. We apply this PCEU approach to Hong Kong and obtain promising results. Compared with the results obtained by the full-blown emission model COPERT, the approach achieves high accuracy but obviates tedious inputs typically required for emission estimation.     

The role of volume-delay functions in forecasting and evaluating congestion charging schemes: the Stockholm case

This paper uses observations from before and during the Stockkholm congestion charging trial in order to validate and improve a transportation model for Stockholm. The model overestimates the impact of the charges on traffic volumes while at the same time it substantially underestimates the impact on travel times. These forecast errors lead to considerable underestimation of economic benefits which are dominated by travel time savings. The source of error lies in the static assignment that is used in the model. Making the volume-delay functions (VDFs) steeper only marginally improves the quality of forecast but strongly impacts the result of benefit calculations. We therefore conclude that the dynamic assignment is crucial for an informed decision on introducing measures aimed at relieving congestion. However, in the absence of such a calibrated dynamic model for a city, we recommend that at least a sensitivity analysis with respect to the slope of VDFs is performed.     

The influence of workplace environment on lung function of shopkeepers working near National Highway in Jalgaon: A note

The inferior ambient air quality was observed near highway passing through Jalgaon urban center. Among the pollutants critical level of particulates are observed at the roadside during May 2003 to April 2004. The shopkeepers working at the highway sides are at high risk of exposure to the air pollution caused by heavy highway traffic. The lung function test of the shopkeepers shows significant decrease in forced vital capacity, forced expiratory volume in one second and peak expiratory flow rate. The regular periodic health checkup and use of nose mask will protect the health of shopkeepers working near National Highway passing through Jalgaon urban center.     

The impacts of household structure on the individual stochastic travel and out‐of‐home activity time budgets

The amount of time individuals and households spend in travelling and in out‐of‐door activities can be seen as a result of complex daily interactions between household members, influenced by opportunities and constraints, which vary from day to day. Extending the deterministic concept of travel time budget to a stochastic term and applying a stochastic frontier model to a dataset from the 2004 UK National Travel Survey, this study examines the hidden stochastic limit and the variations of the individual and household travel time and out‐of‐home activity duration—concepts associated with travel time budget. The results show that most individuals may not have reached the limit of their ability to travel and may still be able to spend further time in travel activities. The analysis of the model outcomes and distribution tests show that among a range of employment statuses, only full‐time workers' out‐of‐home time expenditure has reached its limit. Also observed is the effect of having children in the household: Children reduce the flexibility of hidden constraints of adult household members' out‐of‐home time, thus reducing their ability to be further engaged with out‐of‐home activities. Even when out‐of‐home trips are taken into account in the analysis, the model shows that the dependent children's in‐home responsibility reduces the ability of an individual to travel to and to be engaged with out‐of‐home activities. This study also suggests that, compared with the individual travel time spent, the individual out‐of‐home time expenditure may perform as a better budget indicator in drawing the constraints of individual space–time prisms. Copyright © 2013 John Wiley & Sons, Ltd.