Advanced Transportation Information Systems: A Cost-Effective Alternative for Network Capacity Expansion?

As part of Advanced Transportation Information Systems (ATIS), route planning and guidance (RPG) services have been proposed for potential travel time savings and congestion reduction effects. This study extends previous studies by investigating their effect on consumer surplus and analyzing the tradeoff between network capacity expansions versus RPG services subsidy. Eventually, we analyze whether and to what extent can RPG services substitute network expansion. To answer these questions, this paper develops a mixed-equilibrium model for elastic travel demand and elastic market penetration of RPG services. Drivers are assumed to follow the stochastic user equilibrium conditions, with the drivers equipped with RPG services having lower travel time perception variations. This model is formulated as a nonlinear complementarity problem for exposition clarity and is solved as a variational inequality problem for efficiency, A numerical study is provided to demonstrate the approach.