Managing network congestion with a trip- and area-based tradable credit scheme

Renming Liu*, Siyu Chen, Yu Jiang, Ravi Seshadri, Moshe Ben-Akiva, Carlos Lima Azevedo

*Corresponding author for this work

Research output: Contribution to journalJournal articleResearchpeer-review

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This study proposes a trip- and area-based tradable credit scheme (TCS) for congestion management in the context of the morning commute problem using a trip-based Macroscopic Fundamental Diagram model with heterogenous travelers. In our proposed TCS, the regulator distributes credits to all travelers and designs a time-varying and trip-based credit tariff. Credits are traded between travelers and the regulator via a credit market at the price determined by credit demand and supply interactions. The TCS is incorporated into a day-to-day modeling framework to examine travelers’ learning process, network state evolution, and credit market properties. The conditions for existence of an equilibrium solution and uniqueness of the equilibrium credit price are established analytically. Simulation results validate the analytical properties, demonstrate that the proposed TCS yields identical social welfare as the congestion pricing while maintaining revenue neutrality, and show the superiority of a trip-based TCS to (trip agnostic) area-based TCS.

Original languageEnglish
JournalTransportmetrica B
Issue number1
Pages (from-to)434-462
Publication statusPublished - 2023


  • Day-to-day dynamics
  • Demand management
  • Tradable credits
  • Trip-based macroscopic fundamental diagram


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