Here's an article on Wired that gives interesting detail to studies done to help alleviate congestion in central cities.
It was hoped that (Study founder) Komanoff's work would support a plan to offer completely free public transit. But Komanoff found that the system would still be overloaded at rush hour. Drivers had to be encouraged to travel at different times of the day. So he devised a new plan, one that charged both drivers and transit riders different rates at different times. It would charge $3 to cars entering the CBD on weekday nights, $6 for most of the day, and $9 during rush hour. The subway fare also varies, but is always less than the $2.25 it is today: $1 at night, rising to $1.50 as day breaks, and peaking at $2 during weekday rush hours. Buses are always free, because the time saved when passengers aren't fumbling for change more than makes up for the lost fare revenue. Komanoff's plan also imposes a 33 percent surcharge on every taxi ride, 10 percent of which would go to the cab driver and the rest to the city.
Does this sound familiar? My guess is that he would do better simply letting the market set the rates – That is, determine your goals and adjust the pricing based on those goals. – Don Shoup call your office.
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