Exploring travelers’ responses to a prepeak discount fare policy and optimizing the pricing strategy to ease peak congestion: The case of Beijing subway

Xiangming Yao, Linshan Chen, Peng Zhao, Qingru Zou and Zijia Wang

Transportation Research Part A: Policy and Practice, 2025, vol. 191, issue C

Abstract: Time-based differential pricing strategy is an effective approach to spread the travel demand during peak hours. To reduce morning peak congestion, a trial prepeak discount fare policy was implemented in Beijing subway in the year of 2016. Regrettably, the intended outcome was not realized. This work aims to explore reasons for restricting the effect of the policy, and an optimization model is established to provide a better differential fare plan. Firstly, smart card records before and after the policy are utilized to track the travelers who shift their departure times from peak to prepeak, and the fare elasticity of different passenger types on departure time shifting can be measured. Secondly, based on the group-specific elasticity to fare changes, an integer nonlinear programming model is proposed to optimize the prepeak discount fare scheme which contains the discount station, the discount ratio and the deadline of the discount. Finally, a practical study of the Beijing Line BT is conducted to verify the effectiveness and accuracy of the method. Results indicate that the deadline of the discount has a significant influence on the effect of the fare policy. The major reason for limiting the effect of the prepeak discount fare policy in Beijing subway is that the discount deadline of 7:00 a.m. is too early to effectively shift the actual peak demand. Transit agencies should delay the deadline of the discount but be cautious for changing differential fare structures or raising discounts.

Keywords: Prepeak discount pricing; Peak congestion; Urban rail transit; Integer nonlinear programming model; Fare elasticity of departure time; Smart card data (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1016/j.tra.2024.104335

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