Optimizing intersections

•We optimize the regulation of an intersection of two routes connecting one OD pair.•When only one of the two routes is congestible, it is optimal to block one route.•A toll on one of the two routes allows for an optimal alternating signal setting.•The optimal alternating signal depends only on the relative congestion-sensitivity.•We develop a criterion to choose between traffic lights and a priority rule.

In this paper we optimize the regulation of an intersection of two routes connecting one origin–destination pair and study the effects of priority rules, traffic lights and tolls. We show that when the intersection is regulated by a priority rule the optimal policy is generally to block one of the two routes. When the intersection is regulated by traffic lights, it can only be optimal to leave both routes open when both routes are subject to congestion or if a toll is levied.