Pre-trip information and route-choice decisions with stochastic travel conditions: Theory

This paper studies the effects of pre-trip information on route-choice decisions when travel conditions are congested and stochastic. We adopt a model based on the classical two-route network in which free-flow travel times and/or capacities on each route vary unpredictably due to such shocks as bad weather, accidents, and special events. We show that the benefits of information depend on differences between routes in free-flow costs, the shape of the travel cost functions, the severity of congestion and capacity shocks, and the degree of correlation between routes in travel conditions. Information is more likely to be welfare-reducing when free-flow travel costs differ appreciably, travel cost functions are convex, shocks are similar in size on the routes, and route conditions are strongly and positively correlated.