US-Sweden Cooperative Research: Building and Solving a Bilevel Programming Transportation Model in a Mixed EconomicSystem

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This award will support collaborative research in urban and regional planning between Dr. John Kim, University of Illinois at Urbana and Dr. Lars Lundqvist, Royal Institute of Technology, Stockholm, Sweden. The proposed research will address specific issues in building and applying a land-use transportation planning model appropriate for Sweden, where a strong mixed economic system prevails. The usual view in a mixed economy is that some goods and services are produced privately, and some, such as transportation, are produced publicly. Most existing transportation development planning models designed to shed light on development policy in mixed economic systems miss this essential normative issue, i.e., the interaction between the private and the public sectors. Because of its mixed economy, Sweden provides an ideal environment for testing the applicability of a transportation model with explicit provisions of public-private interaction. Provisions for interaction between the public and private sectors in planning models will shed light on the important issues necessary for planning investment strategies. Private institutions, such as households and entrepreneurs, produce and consume goods and services in pursuing their parochial interests, while the public sector in a typical mixed economic system attempts to broaden public interests. The importance of modelling public-private interaction becomes particularly apparent when one deals with national issues, such as investment priority for transportation development. The objectives of the proposed project include evaluating how a land-use transportation planning model with specific public-private policy issues, such as finding the optimum investment amounts and setting investment priorities for providing infrastructure in mixed economic systems, using Sweden as a case study site. Results of this study will contribute to the fields of transportation, land use and regional science by building a normative theory of how resources should be allocated in mixed economic systems and how transportation and land resources should be allocated efficiently.