Efficiency of a highway use reservation system for morning commute

•Design and efficiency of a highway use reservation system are examined.•Inefficiency due to limited differentiation of reservations is discussed.•Inefficiency due to braking or tactical waiting is discussed.•Inefficiency due to two types of user heterogeneity is discussed.•Auction-based reservation to improve efficiency is proposed. This paper examines the design and efficiency of a highway use reservation system where commuters need reservations to access a highway facility at specific times. We show that, by accommodating reservation requests to the level that the highway capacity allows, traffic congestion can be relieved. Generally, a more differentiated design of the reservation system yields a higher reduction of travel cost and thus achieves a higher efficiency. The efficiency bound of the system is established. We also show that braking or tactical waiting behaviors of drivers would cause a loss of efficiency, which thus need be proactively accommodated. Given that user heterogeneity cause further loss of efficiency, we explore how two specific types of user heterogeneity affect the system efficiency. Auction-based reservation is then proposed to mitigate the efficiency loss.