Efficiency of the reward-equal-charge travel credit scheme for bottleneck congestion

Based on bottleneck model, this paper aims at exploring the welfare effect of the rewardequal-charge (REC) travel credit scheme on commuters with heterogeneity. Under the REC travel credit scheme, the commuters who pass the bottleneck within the peak-time window to either pay certain units of mobility credits. Those who avoid the peak-time window by traveling outside the peak time window could be rewarded credits. A market will be created to decide the credit price and commuters can buy or sell the credits according to their own travel need. The results show that the REC scheme distributes the benefits across the heterogeneous population due to decreasing commuters' equilibrium cost. The REC scheme can guarantee less than 10% efficiency loss compared to the optimal travel credit scheme regardless of the behavioral assumption. Given its simplicity, equity and efficiency, the REC scheme seems to be an ideal choice in practice.