When Are Anonymous Congestion Charges Consistent with Marginal Cost Pricing? /
Arnott, Richard.
When Are Anonymous Congestion Charges Consistent with Marginal Cost Pricing? / 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. t0154 . - Technical Working Paper Series (National Bureau of Economic Research) no. t0154. .
April 1994.
There are constraints on pricing congestible facilities. First, if heterogeneous users are observationally indistinguishable, then congestion charges must be anonymous. Second, the time variation of congestion charges may be constrained. Do these constraints undermine the feasibility of marginal cost pricing, and hence the applicability of the first-best theory of congestible facilities? We show that if heterogeneous users behave identically when using the congestible facility and if the time variation of congestion charges is unconstrained, then marginal cost pricing is feasible with anonymous congestion charges. If, however, the time variation of congestion charges is constrained, optimal pricing with anonymous congestion charges entails Ramsey pricing.
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Mode of access: World Wide Web.
When Are Anonymous Congestion Charges Consistent with Marginal Cost Pricing? / 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. t0154 . - Technical Working Paper Series (National Bureau of Economic Research) no. t0154. .
April 1994.
There are constraints on pricing congestible facilities. First, if heterogeneous users are observationally indistinguishable, then congestion charges must be anonymous. Second, the time variation of congestion charges may be constrained. Do these constraints undermine the feasibility of marginal cost pricing, and hence the applicability of the first-best theory of congestible facilities? We show that if heterogeneous users behave identically when using the congestible facility and if the time variation of congestion charges is unconstrained, then marginal cost pricing is feasible with anonymous congestion charges. If, however, the time variation of congestion charges is constrained, optimal pricing with anonymous congestion charges entails Ramsey pricing.
System requirements: Adobe [Acrobat] Reader required for PDF files.
Mode of access: World Wide Web.