Abstract
Hypercongestion gives the problem of the non-unique relationship between travel time and flow in the fundamental diagram of traffic flow, which depicts the relationship between flow and density. Under the assumption of an exogenous time-pattern of demand and with the hypercongestion model in Small-Chu (1997), chapter one develops the backward iterative method in Vickrey (1991) to derive the marginal cost of additional entries at different times. The results show that the magnitude of the marginal external cost depends on not only the exogenously given entry rate but also the length of the entry period. With exogenous time pattern for demand, the marginal external cost of additional entry in the transportation system will increase to a peak from the beginning. Then it will decrease. During the [special characters omitted] entry period, the marginal cost curve is approximately symmetric. We can use policies, for example, staggering the work starting time, controlling the number of entry to change the entry time pattern to relieve the congestion. It has been noted that there is vicious cycle or virtuous cycle in production of transit services. However, few empirical researches have been done on transit service with consideration of this dynamic simultaneity. In chapter two, I will use dynamic simultaneous equations to model the dynamic simultaneous relationship between transit demand, transit supply and transit cost structure. The results show strong inertia in the bus demand, supply and cost. The response of supply level to the change of demand is consistent to the square root rule (Mohring 1972). This simultaneous model found much stronger scale economy in bus transit, both in short run and long run. The policy simulations show that the higher bus fare will decrease the ridership of bus at the very beginning. However, later on, the higher service brought by the higher revenue will offset the negative effect on ridership from higher bus fare. The operating deficit will decrease when higher bus fare is charged. Even though the favorable city characteristics could increase bus ridership and decrease the operating deficit at the same time, they are out of bus firm’s control.