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Dr. Changhyun Kwon
Jee Eun Kang
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This paper presents a new conceptual approach to improve the operational performance of public bike sharing systems using pricing schemes. Its methodological developments are accompanied by experimental analyses with bike demand data from Capital Bikeshare program of Washington, DC. An optimized price vector determines the incentive levels that can persuade system customers to take bicycles from, or park them at, neighboring stations so as to strategically minimize the number of unbalanced stations. This strategy intentionally makes some unbalanced stations even more highly unbalanced, creating hub stations. This reduces the need for trucks and dedicated staff to carry out inventory repositioning. For smaller networks, a bilevel optimization model is introduced to minimize the number of unbalanced stations optimally.