The generation of construction and demolition waste (CDW) is a problem for societies aspiring to sustainability. In this regard, governments have the responsibility to support the CDW recycling through subsidies. However, the information asymmetry, as well as the “dynamic nature” of the CDW recycling market, results in a number of barriers for the government to promote CDW recycling. In this paper, we establish a mathematical model that includes the government and the recycling enterprise in the presence of dual information asymmetry including the unknown recycling technology level and unobservable recycling efforts in one-stage and two-stage cooperation. Using the incentive theory, the static and dynamic optimal recycling incentive contracts of the government were designed, and the optimal decisions of the recycler were identified. A numerical simulation revealed that by designing reasonable contracts, the government can encourage the recycler to report the true technical level and achieve information screening. Furthermore, the subsidy of the high-tech recycler remained unchanged under different circumstances. However, the subsidy of the low-tech recycler was closely related to the probability of misreporting and the proportion of technology types. This finding suggests that the government and recycler are inclined towards long-term dynamic cooperation.

https://www.mdpi.com/2071-1050/11/10/2943/pdf

Dynamic Incentive Mechanism Design for Recycling Construction and Demolition Waste under Dual Information Asymmetry

SUMMARY Huge public transport subsidies caused by deficits have become a heavy financial burden on some local governments due to the decline of bus passenger numbers. It is essential to apply the performance-based contract to bus services considering maximization of social welfare. This paper constructs an incentive subsidy contract considering the decision-making powers of the service level and calculating the proper frequency elasticity aiming at two problems of performance-based contracts. Meanwhile, we consider a role of bus operators ignored by most researchers. Under the scheme, the decision-making power of the service level is discussed basedon fiveassumptions,andmeanwhile,busoperatorsaremotivatedtoreducecostandimproveservicelevel in the scheme. The case of the bus service of Arao city indicates that the optimal frequency equals to zero when bus operators decidefrequency.Ifbus operatorsdetermineefforts,theoptimaleffort also equalstozerowiththe goal of maximizing the profit. Also, bus operators can play their roles in lessening cost and improving service level to help bus operators and the local government achieve a win-win situation, which maximizes the social benefitinthissubsidyschemewhenallfactorsaredecidedbythegovernment.Copyright©2013JohnWiley& Sons, Ltd. External costs are incurred in urban areas that experience substantial levels of traffic congestion due to the increasing number of private cars. The existence of these external costs is reflected in governments around the world seeking more sustainable means of meeting passenger transport requirements, including support for public transport because of its capacity to meet social obligations and to reduce the external costs of private car use. Therefore, transit subsidies are necessary, given substantial economies of scale, in order to permit services to be set at a level that will result in reasonably efficient use of the public transport. Also, it is regarded as important to provide service for those who are unable to drive, in addition to helping cities find some relief from urban congestion and reducing fuel consumption. Although transit subsidies are necessary to lower the price of public transport and diminish discrimination, they have long been controversial. Pucher et al. [1] noted that costs and subsidies are jointly determined, as higher costs elicit more subsidies, which in turn induce higher costs. As a mechanism with a major objective of containing the cost to government of service provision, competitive tendering (CT) was proposed and applied. The CT contract attracted significant interest because of its attempt to apply responsibilities and incentives to contract operators to reduce cost. The three kinds of incentive contracts are gross-cost, net-cost, and cost-plus contracts. The gross-cost contract introduced in London is payment to the operator of a specified sum of provision of the specifi ed service for as pecified period, with all revenue collected being for the account of the government [2]. Under the net-cost contract, instituted to Hong Kong bus companies, revenues must cover cost and guarantee profit. Worcman [3] concluded that contract payments of

/pdf/incentive-subsidy-scheme-design-with-elastic-transport-4ygv0cs8to.pdf

Incentive subsidy scheme design with elastic transport demand

In this paper, we investigate the social resource allocation in an emerging mobility system consisting of connected and automated vehicles (CAVs) using mechanism design. CAVs provide the most intriguing opportunity for enabling travelers to monitor mobility system conditions efficiently and make better decisions. However, this new reality will influence travelers' tendency-of-travel and might give rise to rebound effects, e.g., increased-vehicle-miles traveled. To tackle this phenomenon, we propose a mechanism design formulation that provides an efficient social resource allocation of travel time for all travelers. Our focus is on the socio-technical aspect of the problem, i.e., by designing appropriate socio-economic incentives, we seek to prevent potential rebound effects. In particular, we propose an economically inspired mechanism to influence the impact of the travelers' decision-making on the well-being of an emerging mobility system.

Social Resource Allocation in a Mobility System with Connected and Automated Vehicles: A Mechanism Design Problem

Competitive tendering and deregulation in the British bus

Are rewards or penalties more effective in influencing user behavior? This work compares the effectiveness of subsidies and tolls in incentivizing users in congestion games. The predominantly studied method of influencing user behavior in network routing problems is to institute taxes which alter users' observed costs in a manner that causes their self-interested choices to more closely align with a system-level objective. Another feasible method to accomplish the same goal is to subsidize the users' actions that are preferable from a system-level perspective. We show that, when users behave similarly and predictably, subsidies offer comparable performance guarantees to tolls while requiring smaller monetary transactions with users; however, in the presence of unknown player heterogeneity, subsidies fail to offer the same performance as tolls. We further investigate these relationships in affine congestion games, deriving explicit performance bounds under optimal tolls and subsidies with and without user heterogeneity; we show that the differences in performance can be significant.

Carrots or Sticks? The Effectiveness of Subsidies and Tolls in Congestion Games

Large public transport subsidies necessitated by operating deficits have become a heavy financial burden on some local governments. However, the present subsidy scheme lacks incentives to encourage bus operators to reduce deficits to lessen subsidies. In order to motivate bus operators to exert their roles in reducing these subsidies to ensure sustainable finance, this paper designs an incentive subsidy scheme based on the Laffont–Tirole model. This scheme is designed to motivate bus operators to endeavor to reduce deficits so as to obtain a premium, thus minimizing the total amount of subsidies and maximizing social benefit. The case of the bus network in Kumamoto, Japan, shows how, with this subsidy scheme, bus operators can play roles in lessening subsidies, allowing a win-win situation for both bus operators and the local government, and maximizing social benefit to realize the sustainability of the city. Finally, findings of our sensitivity analysis with imperfect information suggest that the length of bus lines in a network should be shortened in order to avoid cost waste to lessen subsidies.

https://www.mdpi.com/2071-1050/11/6/1740/pdf

Mechanism Design for an Incentive Subsidy Scheme for Bus Transport

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Mechanism Design for an Incentive Subsidy Scheme for Bus Transport