An Average Cost Pricing Method on Electric Tradable Credits Scheme in Traffic Management

Abstract

Considering the tradable credits' characteristics of public goods, this paper incorporated public pricing method into the tradable credits pricing analysis. Also, in view of budget imbalance of marginal cost pricing, we tried to make a price for the tradable credit by using an average pricing method. This paper constructed an average pricing method of tradable credits by the angles of travel behavior and economics. The main work of this paper is listed as follows: (1) Consumers and producers of tradable credits in the traffic network are defined, and their mathematical constraints are given; (2) Under the tradable credits scheme, the production cost function of producers and demanding function of consumers are analyzed; (3) The mathematical description of average pricing is given; and (4) At last, the process of average pricing on tradable credits are reappeared by a simple numerical example, which average pricing's efficiency on tradable credits. In a word, average cost pricing pushes the application of tradable credits scheme in urban traffic management forward, which has certain theoretical and practical significance to improve the urban traffic demand management.