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219. Why rational queueing of delay risk-sensitive users undermines the benefits of added resources

Invited abstract in session TA-39: Stochastic Models in Service Operations I, stream Stochastic Modelling.

Tuesday, 8:30-10:00
Room: 35 (building: 306)

Authors (first author is the speaker)

1. Benjamin Legros
Skema
2. Johan van Leeuwaarden
Tilburg University
3. Jan C. Fransoo
Tilburg University

Abstract

While policymakers regularly add capacity to reduce congestion in public services like roads and hospitals, empirical studies show that adding resources does not always reduce congestion and delays. To clarify this phenomenon, we propose an explanatory model of rational delay-risk sensitive users who are less inclined to access services when delays are more variable. Using a rational queueing approach, we show that there are largely two opposite effects of increased resource capacity. The public interest benefits through improved throughput and social welfare, while individual users can experience degraded service in terms of expected delays. We offer as an explanation that adding resource capacity reduces delay variability, so that delay-risk sensitive users will more readily join.
In addition, we show that resource capacity not only influences the volume of demand but also its nature: increased service capacity attracts users who are less sensitive to expected delays and more sensitive to delay variability, which
implies that large-capacity systems predominantly attract users who prefer reliability over efficiency.

Keywords

Status: accepted

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