The Ramsey Problem for Congestible Facilities /
Arnott, Richard.
The Ramsey Problem for Congestible Facilities / Richard Arnott, Marvin Kraus. - Cambridge, Mass. National Bureau of Economic Research 1994. - 1 online resource: illustrations (black and white); - NBER technical working paper series no. t0084 . - Technical Working Paper Series (National Bureau of Economic Research) no. t0084. .
May 1994.
In recent years, a new set of models drawing on Vickrey [1969] has been developed to analyze the economics of congestible facilities. These models are structural in that they derive the cost function from consumers' time-of-use decisions and the congestion technology. Standard models, in contrast, simply assume the general form of the cost function. We apply the new approach to analyze the Ramsey problem for a congestible facility, and show that the solution generally entails cost inefficiency. Standard models have failed to reveal this result because they treat the cost function as completely determined by technology.
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The Ramsey Problem for Congestible Facilities / Richard Arnott, Marvin Kraus. - Cambridge, Mass. National Bureau of Economic Research 1994. - 1 online resource: illustrations (black and white); - NBER technical working paper series no. t0084 . - Technical Working Paper Series (National Bureau of Economic Research) no. t0084. .
May 1994.
In recent years, a new set of models drawing on Vickrey [1969] has been developed to analyze the economics of congestible facilities. These models are structural in that they derive the cost function from consumers' time-of-use decisions and the congestion technology. Standard models, in contrast, simply assume the general form of the cost function. We apply the new approach to analyze the Ramsey problem for a congestible facility, and show that the solution generally entails cost inefficiency. Standard models have failed to reveal this result because they treat the cost function as completely determined by technology.
System requirements: Adobe [Acrobat] Reader required for PDF files.
Mode of access: World Wide Web.