2023/01/09 by Kayla Cummings, Cummings, Kayla, Vikrant Vaze +5 · 1 citation
Engineering · Social Sciences · #FOS: Mathematics #Optimization and Control (math.OC) #Transportation Planning and Optimization #Transportation and Mobility Innovations #Urban Transport and Accessibility
paper · pdf · doi:10.48550/arxiv.2301.03414
openalex publication_date 2023/01/09 · openalex created_date 2023/01/11 · openalex updated_date 2026/07/28
Transit agencies have the opportunity to outsource certain services to established Mobility-on-Demand (MOD) providers. Such alliances can improve service quality, coverage, and ridership; reduce public sector costs and vehicular emissions; and integrate the passenger experience. To amplify the effectiveness of such alliances, we develop a fare-setting model that jointly optimizes fares and discounts across a multimodal network. We capture commuters' travel decisions with a discrete choice model, resulting in a large-scale, mixed-integer, non-convex optimization problem. To solve this challenging problem, we develop a two-stage decomposition with the pricing decisions in the first stage and a mixed-integer linear optimization of fare discounts and passengers' travel decisions in the second stage. To solve the decomposition, we develop a new solution approach combining tailored coordinate descent, parsimonious second-stage evaluations, and interpolations using special ordered sets. This approach, enhanced by acceleration techniques based on slanted traversal, randomization and warm-start, significantly outperforms algorithmic benchmarks. Different alliance priorities result in qualitatively different fare designs: flat fares decrease the total vehicle-miles traveled, while geographically-informed discounts improve passenger happiness. The model responds appropriately to equity-oriented and passenger-centric priorities, improving system utilization and lowering prices for low-income and long-distance commuters. Our profit allocation mechanism improves outcomes for both types of operators, thus incentivizing profit-oriented MOD operators to adopt transit priorities.