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The public transport systems in some cities charge high fares during the rush hour than during...

The public transport systems in some cities charge high fares during the rush hour than during the rest of the day. Why might they do this?
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Answer #1

Yes, this is a true statement, that the transportation system charges high fares during rush hour because when the system is congested, each additional riders impose a cost on the other riders.

This is because when the transportation system is congested during rush hour, it creates negative externality to others by creating discomfort due to more congestion. It means it creates the cost to other riders but he does not pay anything for that cost.

Therefore the transport department charges high prices during the rush hour so that people may be discouraged to use the system during rush hour.

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