Alternative High Occupancy/Toll Lane Pricing Strategies and their Effect on Market Share

Michael Janson and David Levinson

No 121, Working Papers from University of Minnesota: Nexus Research Group

Abstract: High Occupancy/Toll (HOT) Lanes typically charge a varying to single occupant vehicles (SOVs), with the toll increasing during more congested periods. The toll is usually tied to time of day or to the density of vehicles in the HOT lane. The purpose of raising the toll with congestion is to discourage demand enough to maintain a high level of service (LOS) in the HOT lane. Janson and Levinson (2014) demonstrated that the HOT toll may act as a signal of downstream congestion (in both general purpose (GP) and HOT lanes), causing an increase in demand for the HOT lane, at least at lower prices. This paper builds off that research and explores alternative HOT lane pricing strategies, including the use of GP density as a factor in price to more accurately reflect the value of the HOT lane. In addition, the paper explores the potential effect these strategies would have on the HOT lane vehicle share through a partial equilibrium analysis. This analysis demonstrates the change in demand elasticity with price, showing the point at which drivers switch from a positive to negative elasticity.

Keywords: Toll Roads; Road Pricing; Transportation Economics; Travel Behavior; Networks (search for similar items in EconPapers)
JEL-codes: R40 (search for similar items in EconPapers)
Date: 2014
New Economics Papers: this item is included in nep-tre and nep-ure
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Published in Journal of the Transportation Research Board: Transportation Research Record. 2672(5), 12–22. (2018)

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http://hdl.handle.net/11299/179825 First version, 2014 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:nex:wpaper:alternativehotprices

DOI: 10.1177/0361198118786637

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