A Traveler Incentive Program for Promoting Community-Based Ridesharing

Amirmahdi Tafreshian () and Neda Masoud ()
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Amirmahdi Tafreshian: Department of Civil and Environmental Engineering, University of Michigan, Ann Arbor, Michigan 48109
Neda Masoud: Department of Civil and Environmental Engineering, University of Michigan, Ann Arbor, Michigan 48109

Transportation Science, 2022, vol. 56, issue 4, 827-847

Abstract: Traffic congestion has become a serious issue around the globe, partly owing to single-occupancy commuter trips. Ridesharing can present a suitable alternative for serving commuter trips. However, there are several important obstacles that impede ridesharing systems from becoming a viable mode of transportation, including the lack of a guarantee for a ride back home as well as the difficulty of obtaining a critical mass of participants. This paper addresses these obstacles by introducing a traveler incentive program (TIP) to promote community-based ridesharing with a ride back home guarantee among commuters. The TIP program allocates incentives to (1) directly subsidize a select set of ridesharing rides and (2) encourage a small, carefully selected set of travelers to change their travel behavior (i.e., departure or arrival times). We formulate the underlying ride-matching problem as a budget-constrained min-cost flow problem and present a Lagrangian relaxation-based algorithm with a worst-case optimality bound to solve large-scale instances of this problem in polynomial time. We further propose a polynomial-time, budget-balanced version of the problem. Numerical experiments suggest that allocating subsidies to change travel behavior is significantly more beneficial than directly subsidizing rides. Furthermore, using a flat tax rate as low as 1% can double the system’s social welfare in the budget-balanced variant of the incentive program.

Keywords: P2P ridesharing; incentive design; community-based ridesharing; monetary subsidy; budget-constrained min-cost flow problem; guaranteed ride back home (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:inm:ortrsc:v:56:y:2022:i:4:p:827-847

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