The Optimal Taxi Fleet Size Structure under Various Market Regimes When Charging Taxis with Link-Based Toll

Abstract

This paper investigates the optimal taxi fleet size structure under monopoly and oligopoly market regimes when taxis are charged with the link-based toll. We proposed a bilevel programming model to take account of the interaction between taxi fleet size and different traffic modes in the network. The upper level is to determine the optimal taxi fleet structure so as to maximize the profit of each taxi firm. The lower-level is a combined network equilibrium model (CNEM) representing the travelers’ response to the equilibrium taxi fleet size structure when congestion toll is imposed on taxis. We show that the lower level problem can be formulated as an equivalent variational inequality formulation, which considers the hierarchical logit-based mode split, route choice, elastic demand, and vacant taxi distributions. The bilevel problem can be solved by an iterative heuristic solution algorithm, whereas the lower level model is solved by the block Gauss-Seidel decomposition approach together with method of successive averages. An application with numerical examples is presented to illustrate the effectiveness of the proposed model and algorithm, and some interesting findings are also provided.