Pareto-improving policies for an idealized two-zone city served by two congestible modes

Shu-Xian Xu, Ronghui Liu, Tian-Liang Liu and Hai-Jun Huang ()

Transportation Research Part B: Methodological, 2018, vol. 117, issue PB, 876-891

Abstract: We study urban structure and traffic congestion of a monocentric city by idealizing its suburb and its core as two zones and then exploring what would happen when they are connected by a congestible highway and a crowded railway system. We introduce dynamic congestion effect into commuters’ departure-time and mode choice behaviours, and analyse the endogenous interactions between their travel and residential relocation choices. Studies ignoring dynamic departure-time behaviour show an ambiguous effect of transit improvements to the city. However, we find that transit improvement has a definitive impact on city structure: it increases the residents’ equilibrium utility, at a cost of increased suburb land use. We show that it is possible to design Pareto-improving land-use and transit policies which benefit the residents without causing urban sprawl. We provide analytically the existence conditions of such policies and suggest that a high return of land use tax to subsidize transit improvement is required.

Keywords: Monocentric city model; Dynamic congestion; Land use tax; Transit subsidy; Urban sprawl; Pareto improving (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (16)

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DOI: 10.1016/j.trb.2017.08.010

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