Abstract
ETC (Electronic Toll Collection System) is a new technology and has the propertythat the rise of the number of drivers purchasing ETC device in the start-up period reduces its future price. In this paper, a real option model is formulated to investigate drivers' purchasing behavior in the presence of the diachronic pecuniary externalities and decision-making costs. Furthermore, alternative policies, 1) temporary financial support program and 2) information disclosure, are introduced.It is shown that for the prevalence of ETC, it is required to implement a combination of policies which have each different effect for different types of drivers.
