Graduation Year

2020

Date of Submission

1-2020

Document Type

Campus Only Senior Thesis

Degree Name

Bachelor of Arts

Department

Mathematics

Second Department

Economics

Reader 1

Henry Schellhorn

Reader 2

Chiu Yen Kao

Abstract

We test the model introduced by Cheng [Market on the Freeway, Ph.D. dissertation, Claremont Graduate University (2019)]. Cheng and Schellhorn [Market on the Freeway , ssrn.com/abstract=3452840 (2019)], shows how much total driving time can be saved during heavy traffic on a freeway if vehicles are able to pay a price to change lanes. This setup allows drivers to differentiate their value of time and treats speed as if it were traded on a free market. In this thesis, we test the CS model as well as an extension to this model, which we will refer to as the Holman-Schellhorn model (HS model) for convenience. A major improvement of the HS model over the CS model is to add a correction term for lateral motion, and to implement a more correct representation of the price volatility matrix, in the equation that determines the fair price to be paid to change lanes. In this paper, we test the impact of changing parameters to maximize the time saved for vehicles. These parameters include lane volatility, initial density, price elasticity of lateral flux, price adjustment factor, and speed of mean reversion of the price. Finally, we test the impact of adding an on-ramp, an off-ramp, and an accident.

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This thesis is restricted to the Claremont Colleges current faculty, students, and staff.

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