Sensitivity analysis based method for optimal road network pricing

Road pricing is an important economic measure for optimal management of transportation networks. The optimization objectives can be the total travel time or total cost incurred by all the travelers, or some other environmental objective such as minimum emission of dioxide, and so on. Suppose a certain toll is posed on some link on the network, this will give an impact on flows over the whole network and brings about a new equilibrium state. An equilibrium state is a state of traffic network at which no traveler could decrease the perceived travel cost by unilaterally changing the route. The aim of the toll setting is to achieve such an equilibrium state that a certain objective function is optimized. The problem can be formulated as a mathematical program with equilibrium constraints (MPEC). A key step for solving such a MPEC problem is the sensitivity analysis of traffic flows with respect to the change of link characteristics such as toll prices. In this paper a sensitivity analysis based method is proposed for solving optimal road pricing problems.