WIT Press

Optimisation Of Transit Fares: A Multimodal Approach Based On System And External Costs


Free (open access)

Paper DOI






Page Range

125 - 136




407 kb


B. Montella, L. D’Acierno & M. Gallo


In this paper a model for the optimisation of transit fares is proposed and tested on a trial network. This model considers a multimodal transportation system under the assumption of elastic demand for simulating the impacts of fare policies on modal split. The model takes into account all system and social costs: (transit and road) user costs, firm costs and external costs. First tests on a trial network show the non-negligible impacts of transit fare design on the overall transportation system conditions and on social costs. Keywords: transit fares, multimodal optimisation, external costs, elastic demand. 1 Introduction Fares for public transit services are generally set under the profitability threshold: ticket revenues cover only a (minor) part of operational costs, while the other part is subsidised by public funds. This faring policy is adopted for social and environmental reasons. Chapleau [1], Hodge [2], Obeng [3] and Parry and Bento [4] studied the social aspects of the problem. More generally, the effects of transit pricing policies were studied by Ballou and Mohan [5], Ferrari [6], Huang [7], Karkaftis and McCarthy [8], Zhou et al [9], Wichiensin et al [10] and Proost and Van Dender [11]. In this paper an optimization model for establishing transit fares is proposed; this model, in accordance with problem features, satisfies the following requirements:


transit fares, multimodal optimisation, external costs, elastic demand