Game theory and transportation systems modelling

In this paper, correspondences are drawn between two game theory models (Nash noncooperative and Stackelberg games) and some problems in transportation systems modelling. An example of each is described in detail, namely the problem of carriers competing for intercity passenger travel and the signal optimization problem. The discussion serves to underline differences between two categories of transportation problems and introduces the game theory literature as a potential source of solution algorithms. Also it is shown that inner-outer iterative techniques for Stackelberg type problems cannot be expected to converge to the solution, and an approximate formulation of these problems is introduced which appears to be more readily solvable.