1. Arms Race David Levinson

2. The Onion A study by the American Public Transportation Association reveals that 98 percent of Americans support the use of mass transit by others.” They reported on a campaign supposedly kicked off by APTA "Take The Bus... I'll Be Glad You Did."

4. Richardson Arms Race Model Lewis Frye Richardson, a Quaker physicist, suggested that an arms race can be understood as an interaction between two states with three motives. Grievances between states cause them to acquire arms to use against one another. States fear each other and so acquire arms to defend themselves against the others’ weapons. Because weapons are costly, their expense creates fatigue that decreases future purchases.

5. Example ArmsRace.xls

6. How Does This Relate To Transport/Land Use Arms Races Bicycle vs. Car Bus vs. Car SUV vs. Car Communities fighting for development, Communities building infrastructure (competitive advantage/disadvantage)

7. Caveat Planner Richardson’s (or any abstract) model is obviously a simplification. We can relax assumptions and make it more realistic (e.g. (dis)economies of scale associated with arms … does fatigue per unit of armament increase or decrease with total level of armaments?)

8. Prisoner’s Dilemma Player B Player A CooperateDefect Cooperate[10,10][-15,15] Defect[15,-15][5,5]

9. Repeated Prisoner’s Dilemma If 2 players, and game repeated indefinitely, the incentive is to cooperate. However if the end is known, the incentive is to defect on the previous turn. Also, if there are multiple players, cooperation becomes much more difficult to achieve

10. Modal Arms Races

11. Modal Arms Races (payoffs are time, try to minimize) Commuter 2 Commuter 1 BusCar Bus[10,10] Good bus service [20, 5] Poor bus service Car[5,20] Car takes advantage of empty roads [15,15] congestion sets in

12. Travel Time as Mode Share Changes

13. Model 1 Here we assumed the following: M A = Auto Mode Share M B = Bus Mode Share = 1 – Auto Mode Share T A = Auto Travel Time T B = Bus Travel Time

14. OR (Note Total Time Drops as Car Use Rises)

15. D = Schedule Delay Model 2

16. Implications Driving is always faster than riding the bus. Total travel time would be minimized if everyone rode the bus. Buses could operated frequently and more directly. However, in the absence of cooperation, the rational outcome is for everyone to drive. Cooperation is difficult to achieve in multi- player games.

17. Cooperation How can cooperation be achieved?

18. Beijing: Cars vs. Bikes

19. Individual Rationality Assumption: Individuals will do what is in their own long term interest. This can’t always be measured. Max U = f( time, money, socioeconomics, demographics, etc.) Probability of taking a mode: Pm = e Um /∑e Um

20. Conclusions Mode share must be understood as a system involving competition. This competition, under certain circumstances (without subsidies for positive feedback industries, and without penalties for negative externalities), may result in socially sub-optimal results. The degree to which the results are sub-optimal, and subsidies are justified, depends on (1) belief that government can actually figure out where to direct subsidy (the pork problem), (2) understanding the dynamics of the system under question. Not all subsidies are warranted, though many are justfied wrongly based on this logic.