Abstract
This study examines the effects of location-dependent parking fees and time-varying congestion tolls on the behavior of heterogeneous commuters and their commuting costs. To this end, we develop a model of departure time and parking location choices by heterogeneous commuters and characterize its equilibrium. By comparing the equilibrium with and without pricing policies, we obtain the following results: 1) without pricing policies, interactions among heterogeneous commuters yield an inefficient distribution of trip timing and parking locations; 2) imposing a parking fee and expanding parking capacity may concentrate the temporal distribution of traffic demand, thereby exacerbating traffic congestion and total commuting cost; 3) the social optimum is achieved by combining a parking fee with a congestion toll; and 4) the revenue obtained from pricing of parking and roads exactly equals the costs for optimal parking and bottleneck capacity; that is, the self-financing principle holds in the model.
