Agent-based model of price competition, capacity choice, and product differentiation on congested networks

Lei Zhang, David M. Levinson, Shanjiang Zhu

Research output: Contribution to journalArticlepeer-review

27 Scopus citations

Abstract

Using consistent agent-based techniques, this research explores the welfare consequences of product differentiation on congested networks. The economic analysis focuses on the source, evolution, measurement, and impact of product differentiation with heterogeneous users on a mixed ownership network. Path differentiation and space differentiation are defined and measured for a base scenario and several variants. The findings favour a fixed-rate road pricing policy compared to complete pricing freedom on toll roads. It is also shown that the impact of production differentiation on welfare is not always positive and depends on the level of user heterogeneity.

Original languageEnglish (US)
Pages (from-to)435-461
Number of pages27
JournalJournal of Transport Economics and Policy
Volume42
Issue number3
StatePublished - Sep 1 2008

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