Revenue Maximizing Tariff Zone Planning for Public Transport Companies

This project presents two approaches to design a counting zones tariff system applicable for urban public transport service providers. The proposed approaches are oriented to a counting zones tariff system that maximizes the expected revenue for a given price system. It is assumed that the price per zone takes a discrete set of values, the number of public transport trips depends on the price system, public transport passengers always choose the time-shortest path. The exact method aims to partition the transport network into zones and find a price per zone such the total expected revenue is maximized. The heuristic approach reduces the problem size; it only considers transport network connections with the most significant revenue. In extensive numerical studies with artificial test instances, it is evaluated for different network structures and public transportation demand which of the proposed approaches perform best. This project sheds light for service providers on how the service area can be zoned to maximize expected revenue through a counting zones tariff system.