Department of Mathematics
A practical trial-and-error implementation of marginal-cost pricing on networks
This paper proposes a trial-and-error implementation of marginal-cost pricing on transportation networks in the absence of both demand functions and travel time functions. Assuming that the corresponding link flows for given trial tolls are observable and that the approximations of the exact travel time functions are provided, the new trial is obtained via solving a system of equations. The new trial-and-error implementation is proved to be convergent globally under mild assumptions, and its improvements over existing methods are verified by some numerical experiments.
Marginal cost, Network pricing problems, Trial-and-error, Variational inequality
Source Publication Title
Journal of Industrial and Management Optimization
American Institute of Mathematical Sciences
Han, Deren, Hai Yang, and Xiaoming Yuan. "A practical trial-and-error implementation of marginal-cost pricing on networks." Journal of Industrial and Management Optimization 6.2 (2010): 299-313.