Network Equilibrium under Cumulative Prospect Theory and Endogenous Stochastic Demand and Supply

Agachai Sumalee, Richard D. Connors and Paramet Luathep
Additional contact information
Agachai Sumalee: The Hong Kong Polytechnic University
Richard D. Connors: University of Leeds
Paramet Luathep: The Hong Kong Polytechnic University

Chapter Chapter 2 in Transportation and Traffic Theory 2009: Golden Jubilee, 2009, pp 19-38 from Springer

Abstract: Abstract In this paper we consider a network whose travel demands and road capacities are endogenously considered to be random variables. With stochastic demand and supply the route travel times are also random variables. In this scenario travelers choose their routes under travel time uncertainties. Several evidences suggest that the decision making process under uncertainty is significantly different from that without uncertainty. Therefore, the paper applies the decision framework of cumulative prospect theory (CPT) to capture this difference. We first formulate a stochastic network model whose travel demands and link capacities follow lognormal distributions. The stochastic travel times can then be derived under a given route choice modeling framework. For the route choice, we consider a modeling framework where the perceived value and perceived probabilities of travel time outcomes are obtained via transformations following CPT. We then formulate an equilibrium condition similar to that of User Equilibrium in which travelers choose the routes that maximizes their perceived utility values in the face of transformed stochastic travel times. Conditions are established guaranteeing existence (but not uniqueness) of this equilibrium. The paper then proposes a solution algorithm for the proposed model which is then tested with a test network.

Keywords: Route Choice; Network Equilibrium; Transportation Research Part; Cumulative Prospect Theory; Probability Weighting Function (search for similar items in EconPapers)
Date: 2009
References: Add references at CitEc
Citations: View citations in EconPapers (12)

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-1-4419-0820-9_2

Ordering information: This item can be ordered from
http://www.springer.com/9781441908209

DOI: 10.1007/978-1-4419-0820-9_2

Access Statistics for this chapter

More chapters in Springer Books from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().