Competition between high-speed and conventional rail systems: A game theoretical approach

Chiung Wen Hsu, Yusin Lee, Chun-Hsiung Liao

Research output: Contribution to journalArticlepeer-review

59 Citations (Scopus)


Coexistence of a high-speed railroad and a conventional railroad in a common transportation corridor creates competition and cooperation between the two systems. By studying the case in Taiwan, we develop a game theoretical model to describe the rail systems' pricing strategy under a two-part tariff pricing structure. With the proposed heuristic, the model solves for the ticket prices under the Nash equilibrium. We use the widely-employed "linear city" concept to model the passengers' locations and combine the passengers' origin and destination regions into a two-dimensional O-D rectangle. The model yields reasonable results when tested with parameters derived from real data. Further comparative static analysis demonstrates the ability of the model to predict the two rail system's response to various scenarios, including changes in operation efficiency, passengers' costs and time value, competition intensity, and service level. Test results are close to expectation.

Original languageEnglish
Pages (from-to)3162-3170
Number of pages9
JournalExpert Systems With Applications
Issue number4
Publication statusPublished - 2010 Apr 1

All Science Journal Classification (ASJC) codes

  • General Engineering
  • Computer Science Applications
  • Artificial Intelligence


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