Citation

Pigman JG, Agent KR, Mayes JG, Zegeer CV. Transp. Res. Rec. 1976; 585: 49-59.

Copyright

(Copyright © 1976, Transportation Research Board, National Research Council, National Academy of Sciences USA, Publisher SAGE Publishing)

DOI

unavailable

PMID

unavailable

Abstract

Determining which projects to implement under a given budget and which to defer until later is central to the planning and management of highway systems. With a limited budget for construction, maintenance, and safety improvements, investments must produce optimal benefits. This paper discusses a dynamic programming procedure developed to select the optimal combination of safety improvement projects for a given budget. The type of dynamic programming considered is multistage, i.e., cost optimization of several projects, each with one or more alternatives. All safety improvement costs are dealt with in terms of present worth, and consideration is given to construction or installation cost, yearly maintenance cost, yearly maintenance cost, present interest rate, and expected life of the improvement. The option of staging safety improvements over a number of years was excluded from this analysis. All possible combinations of improvements were input as alternatives for each of the 61 projects involved in this study. The input consisted of the designated budget for the safety improvement program, the improvement cost, and the benefits derived from each improvement. The accuracy and reliability of dynamic programming depend on the accuracy of benefits and costs used as input. In a comparison with benefit-cost analyses, dynamic programming yielded a higher return for a given budget. An optimal allocation of funds will always be obtained if the individual project costs are multiples of the increment used in dynamic programming.