Multiple stakeholders in road pricing: A game theoretic approach

Anthony Ohazulike, Georg J. Still, Walter Kern, Eric C. van Berkum

Research output: Chapter in Book/Report/Conference proceedingChapterAcademicpeer-review

Abstract

We investigate a game theoretic approach as an alternative to the standard multi-objective optimization models for road pricing. Assuming that various, partly conflicting traffic externalities (congestion, air pollution, noise, safety, etcetera) are represented by corresponding players acting on a common network, we obtain a non-cooperative game where each player pursues a different road pricing strategy to control a specific externality. The game is actually a Stackelberg game, but now with multiple leaders/actors in the upper level determining link tolls, and road users as followers in the lower level, adapting their route choice to the tolls imposed. This chapter reviews our earlier results on the game theoretic models, and the existence of Nash Equilibrium (NE). In order to cope with the fact that NE may not exist in the game, we propose a “first-best taxation” scheme, allowing the government to enforce pre-described NE (analogous first-best pricing schemes). We further discuss the stability of this taxing mechanism
Original languageEnglish
Title of host publicationGame Theoretic Analysis of Congestion, Safety and Security
EditorsKjell Hausken, Jun Zhuang
Place of PublicationLondon
PublisherSpringer
Pages159-189
Number of pages31
ISBN (Print)978-3-319-11673-0
DOIs
Publication statusPublished - 2015

Publication series

NameSpringer Series in Reliability Engineering
PublisherSpringer
ISSN (Print)1614-7839

Keywords

  • Equilibrium problem with equilibrium conditions
  • EWI-26503
  • Multi-level optimization
  • Nash equilibrium
  • Road pricing game
  • Multi-objective optimization
  • Mechanism Design

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  • Cite this

    Ohazulike, A., Still, G. J., Kern, W., & van Berkum, E. C. (2015). Multiple stakeholders in road pricing: A game theoretic approach. In K. Hausken, & J. Zhuang (Eds.), Game Theoretic Analysis of Congestion, Safety and Security (pp. 159-189). (Springer Series in Reliability Engineering). London: Springer. https://doi.org/10.1007/978-3-319-11674-7_7