Transpn Res.-A, Vol. 32, No. 7, pp.

539545, 1998
# 1998 Elsevier Science Ltd. All rights reserved
Printed in Great Britain
0965-8564/98 $19.00+0.00

Pergamon
PII: S0965-8564(98)00017-2

A CAPACITY PARADOX IN NETWORK DESIGN AND

HOW TO AVOID IT
HAI YANG*

Department of Civil Engineering, The Hong Kong University of Science & Technology, Clear Water Bay, Kowloon,
Hong Kong, China

and
MICHAEL G. H. BELL

Department of Civil Engineering, University of Newcastle, Newcastle upon Tyne, NE1 7RU, U.K.
(Received 18 July 1997; in revised form 19 February 1998)
AbstractThe network design problem is often alluded to in the transportation literature together with the
spectacular example of Braess paradox, which tells us that creating a new link in a congested network or
adding capacity to an existing link may actually increase network-wide congestion or user travel costs. In this
note we introduce a new paradox pertaining to network design problems. Using a simple network example,
we demonstrate that the addition of a new road segment to a road network may actually reduce the potential
capacity of the network. We then show how this capacity paradox can be avoided by introducing the concept
of network reserve capacity into network design problems. # 1998 Elsevier Science Ltd. All rights reserved
Keywords: capacity paradox, trac ow, network equilibrium, network design.
1. INTRODUCTION

The Network Design Problem (NDP) involves the optimal decision on the expansion of a street
and highway system in response to a growing demand for travel. This has emerged as an important area for progress in handling eective transportation planning. Historically, this problem has
been posed in two dierent forms: a discrete form dealing with the addition of new links or roadway segments to an existing road network, and a continuous form dealing with the optimal capacity expansion of existing links. In whichever form, the objective of NDP is to optimize a given
system performance measure so as to minimize total system travel costs or alternatively increase
network-wide capacity, while accounting for the route choice behavior of network users. For a
most recent comprehensive review, the reader may refer to, for example, Yang and Bell (1998).
Bearing upon the NDP, Braess constructed a remarkable example (known as the Braess Paradox) demonstrating that introducing a new link in a congested network can actually increase network-wide congestion or the travel costs of each driver (Braess, 1968).y Braess' spectacular
example has generated substantial interest among transportation researchers who have expressed a
great deal of concern about its implications for transportation network design. For instance,
Alperovich (1993) and Hallefjord et al. (1994) examined the welfare aspect of the Braess paradox
in the case with elastic demand. Arnott et al. (1993) discussed a similar paradox arising in a
dynamic trac equilibrium of a Y-shaped highway corridor. Most recently, Pas and Principio
(1997) and Penchina (1997) examined some properties of the Braess paradox. They showed that
*Author for correspondence. Fax:00-852-2358-1534; e-mail: cehyang@usthk.ust.hk
y
It is also known that adding capacity to an existing link in a congested network might not improve the overall performance
of the network. This counter-intuitive result is referred to as the ``PigouKnightDowns paradox'' by Arnott and Small
(1994). In fact, it can be shown that adding capacity to an existing link in a congested network may actually raise travel
time (Yang, 1997).

539

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whether Braess's paradox does or does not occur depends on the link congestion function parameters and the demand for travel.
This note introduces a new paradox that might be encountered in road network design. Using a
simple network example, we demonstrate that creating a new link in a road network may actually
reduce the potential capacity of the network.* We then show how the capacity paradox can be
avoided by introducing the concept of network reserve capacity into network capacity improvement plans. The importance and procedure of identifying the capacity paradoxical situation in
NDP is briey discussed.
2. AN EXAMPLE OF CAPACITY PARADOX

Consider the network shown in Fig. 1. This network is essentially the same as that used by
Braess (1968) except for the link capacities and link cost functions as depicted beneath the network. There is only one origindestination (OD) pair from origin node 1 to destination node 2.
Before link 5 is added, the OD demand will be split equally between routes 1!3!2 and 1!4!2
from the symmetrical property of the network. Therefore, the maximum capacity, Cnet, of the
network under network equilibrium is simply determined by
Cnet minC1 ; C3 minC2 ; C4 10 10 20veh=min:
Now suppose that link 5 is added to the network and this link is used for a certain range of OD
demand denoted as D. Let f1342 denote the path ow over route 1!3!4!2 at network
equilibrium. Then, according to the symmetrical property, the equilibrium ow distributions over
the other two routes are equal and given by f132 f142 D f1342 =2, the equilibrium link
ows are given by 1 4 D f1342 24C1 C4 10 (veh/min), 2 3 D f1342 24C2
C3 20 (veh/min) and 5 f1342 4C5 10(veh/min). In view of these link capacity constraints, we
have 04D420 f1342 , the maximum demand that can be accommodated by the network is thus
Dmax 20 f1342 veh=min. Therefore, the capacity, Cnet, of the network under user-equilibrium
conditions is reduced to
Cnet Dmax 20 f1342 20 5 veh=min
and the net reduction is equal to 5 045 410 whenever there is a positive ow on the newly
added link 5 at the equilibrium point where network capacity is reached.
In fact, Fig. 2 depicts the change of equilibrium link ows as the total demand is increased from
0 to 20 (veh/min). It can be seen that ows on links 1 and 4 reach their capacity when the total
demand is increased up to 15 (veh/min). If we dene this critical value or the maximum admittable
demand as the network capacity, then at this level the equilibrium ow on link 5 is 5 5 (veh/
min), which is exactly equal to the network capacity reduction [from original 20 (veh/min) to the
current 15 (veh/min)].
Note that the network capacity here is actually dened as the maximum throughput of the network at which ows on the two bottleneck links just reach their capacity, but no queues develop
behind the bottlenecks. If we extend our result to include queues on the network, then the network
throughput can be further increased in a queuing network equilibrium state.y The queuing equilibrium link ows are depicted in dashed lines in Fig. 2. As we can see, in this case as total demand
is increased from 15 to 20 (veh/min), ow on link 5 decreases from 5 to 0 (veh/min), while queues
behind bottleneck links 1 and 4 develops.{ Although in this extreme case, the same maximum
throughput of 20 (veh/min) as the original base network (without link 5) is achieved, queues are

*Daganzo (1996, 1998) introduced an interesting capacity paradox example: In a queuing network with equilibrium trac
ow, expansion of the capacity of a bottleneck will result in the abandonment of an alternative route due to the spill over
eect of vehicular queues, and as a result, the total throughput of the network is reduced.
y
The authors are grateful to Carlos Daganzo (pers. comm., 1997) to point this out.
{
It can be easily checked that queue length behind the bottleneck links grows from 0 to 100 vehicles as total demand is
increased from 15 to 20 (veh/min). It is assumed that there is enough storage capacity behind the bottlenecks and queues
do not block the upstream links.

A capacity paradox in network design and how to avoid it

541

induced on the two bottleneck links. Queues behind the bottlenecks stabilize at a level where the
delay they add is just enough to encourage people to divert so as to maintain capacity ow. This
means that the maximum ow pattern on the extended network still becomes worse than before in
the extreme case because queues are created even though the network capacity remain the same.
The aforementioned capacity paradox arises due to the fact that the path ow over route
1!3!4!2 used both bottlenecks whose capacities govern the total capacity of the network.

Fig. 1. An example of a capacity paradox: the addition of a new link 5 will reduce the network capacity.

Fig. 2. Changes in the equilibrium link ows with total OD demand after link 5 is added to the network.

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H. Yang and M. G. H. Bell

Therefore, adding link 5 is harmful.* It either reduces network throughput at particular level of
service or creates queues at original full network capacity ow. This important observation indicates that the addition of a link to an existing network may actually make the network worse in terms
of either reduction in maximum network ow at certain service level or creation of trac queues at
full network physical capacity.
3. HOW TO AVOID THE CAPACITY PARADOX

Clearly, the aforementioned paradoxical situation is detrimental if the network expansion is

intended to accommodate a future fast-growing demand for travel. For this simple network
example, the capacity paradox can be easily identied. In connection with NDP, two simple
methods can be used to modify or eliminate the capacity paradoxical behavior: either reversing
link 5 or enhancing the capacity of links 1 and 4 simultaneously up to exceeding those of links 3
and 2. However, for a realistically large network, it is impossible to intuitively identify such a
capacity paradox, and a systematic way to deal with its occurrence becomes desirable.
In fact, an ecient manner to avoid the occurrence of the capacity paradox is to maximize the
network reserve capacity in NDP. The concept of reserve capacity has been originally used for
performance measure and timing design of individual signal-controlled intersections (Allsop, 1972)
and has been recently extended by Wong and Yang (1997) to a general signal-controlled road
network. The same concept can be incorporated into the current NDP by choosing the link addition or capacity expansion to maximize the network reserve capacity subject to user equilibrium
constraints.
The reserve capacity for a road network can be measured by how large a common multiplier can
be applied to a given basic OD matrix subject to the ow on each link not exceeding its capacity
(and no queue is allowed) when the multiplied OD matrix is allocated to the network in a useroptimal manner. Thus, the corresponding NDP is to nd the maximum value of OD matrix
multiplier subject to given constraints:
maximize  subject to : a d; u4Ca ua for all network links
;u

where a d; u represents the equilibrium ow on link a when the vector, d, of the basic demands
of all OD pairs is increased by  times, and assigned to the network according to the standard
user equilibrium principle, Ca ua is the capacity of link a as a function of the decision variable ua
which represents either the addition of a new link or expansion of an existing link, u is a vector of
all decision variables. Note that any other relevant constraint such as a budget constraint can be
added to the model.
Let the reserve capacity or the maximum OD matrix multiplier associated with the basic network (the `do-nothing' alternative) be 0 and the reserve capacity associated with the creation of a
particular new link b (or capacity expansion of an existing link) b . Then link b is a paradoxical
link if b < 0 and should be avoided in the selection of candidate links for construction or
expansion. Therefore, the reserve capacity model can be used to eciently identify the occurrence
of the capacity paradox for a given road network and its basic OD demand pattern.
Here we consider the same network example to explain the impact of link addition and/or
capacity expansion on the network reserve capacity. Suppose the basic demand from origin 1 to
destination 2 is 10 (veh/min). As discussed before, the maximum OD ow that can be accommodated by the basic network without link 5 is 20 (veh/min), so the network reserve capacity is
0 20=10 2:0. Instead of the assumption of the xed capacity of new link 5, we investigate the
network reserve capacity under the varied capacities of link 5 (in this case the decision variable in
the reserve capacity-based NDP is u C5 ). Here the reserve capacity is calculated at the point at
which link ows just reach their capacities without inclusion of queues. The cost function for this
new link is assumed to be t5 5 101 5 =C5 (min). When C5 10 (veh/min), we have the

*It can be inferred that adding capacity to link 5 (suppose link 5 already exists in the network) may also make the network
ow worse since path ow over route 1!3!4!2 may increase.

A capacity paradox in network design and how to avoid it

543

Fig. 3. Change in the network reserve capacity under the varied capacities of link 5.

same situation as examined before: the maximum OD ow is reduced to 15 (veh/min), and the
network reserve capacity thus becomes 5 15=10 1:5, where 5 is the network reserve capacity
associated with the addition of new link 5. Figure 3 shows the change of the network reserve
capacity under varied levels of the capacity of link 5 together with that of the basic network
without link 5. Evidently, the addition of link 5 in this case results in a reduction in network
reserve capacity in comparison with the `do-nothing case', and the reduction becomes larger as the
capacity of link 5 increases. Therefore, the addition of link 5 or the expansion of its capacity (if
existent) is not desirable in any network capacity improvement scheme.
Finally we mention that the capacity-based formulation of NDP has a number of advantages:
(1) it allows us to predict how much additional demand can be accommodated by the road network after improvement, and hence other ecient policies for trac restraint and growth can be
established; (2) the upper-level objective function takes a simple linear form and hence the problem
is much easier to solve than existing forms of NDP; and (3) maximization of the network reserve
capacity will favor investment in links with higher or more critical `ow/capacity' ratios, and is
thus intuitively equivalent to favor links with a higher marginal social cost, it is thus expected that
the maximization of the reserve capacity and the minimization of the total travel cost might result
in similar solutions at a high-level demand.
4. COMPARISON WITH THE BRAESS PARADOX

It is interesting to investigate the relationship between the Braess paradox and the current
capacity paradox. It is generally expected that both paradoxes may occur simultaneously in a
network, but this may not always be true as demonstrated below.
Consider the same example, Fig. 4 indicates the changes of the average or private travel cost
versus the demand levels at user-equilibrium over the basis (without link 5) and over the extended
[with link 5 and C5 10 (veh/min)] networks. We can easily observe that the construction of link 5
may either increase or decrease the average travel cost, depending on the levels of demand. For
this particular network, link 5 is warranted if the demand is less than 40/7 (veh/min), and should
be avoided if 40=74D420 (veh/min). Occurrence of the Braess paradox thus depends upon the
level of demand, and is therefore hidden only until a particular demand pattern manifests itself.*
Therefore, the outcome of a cost-based NDP will depend upon the level of demand selected for the

*Dependence of the occurrence of the Braess paradox on the level of demand has been mentioned by Rilett and Van Aerde
(1991), Yang (1997), Pas and Principio (1997) and Penchina (1997).

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H. Yang and M. G. H. Bell

Fig. 4. Average travel cost for varied levels of demand under user-equilibrium conditions.

network improvement plan, because its objective is to minimize the total social cost associated
with the given basic reference OD matrix.
In contrast, the capacity-based NDP will exhibit dierently. In the present example, the nal
decision variable values are independent of the actual magnitude of the basic OD matrix, link 5 is
always undesirable irrespective of the OD demand selected for capacity maximization. The basic
OD matrix serves only as the OD distribution pattern or unit OD matrix, based on which
network reserve capacity is measured and maximized. The optimal solution of decision variables in
a capacity-based NDP depends on the basic pattern of O-D distribution rather than its actual
magnitude, although the latter aects the resultant value of reserve capacity (objective value).
Evidently, this is a desirable property when future trac demands are uncertain.
5. CONCLUSION

This note has shown, using a simple network example, that the addition of a new road segment
to an existing network may actually reduce the network reserve capacity at certain service level or
make the maximum network ow pattern worse. The capacity paradoxical situation is of course
detrimental if the network improvement plan is designated to accommodate future high potential
demands for travel. A new concept of network reserve capacity has been suggested for use as the
objective function of NDP. Apart from its capability for identifying and avoiding the capacity
paradox, the capacity-based NDP has a number of desirable properties from both a computational and a modeling standpoint. Further studies should be conducted to establish the relationship between the capacity maximization and cost minimization NDPs and to compare their
performances using realistically large networks.
AcknowledgementsThe authors thank two anonymous referees for their helpful comments. This study was supported by
the Hong Kong Research Grants Council through a RGC-CERG Grant (HKUST638/95E).
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