Besides of considering of the maximization of public interest, the benefit of passengers and railway enterprises are both considered and a bi-level programming approach is presented in order to seek the optimal railway passenger-ticket pricing strategy under the condition of competition among different intercity traffic modes. There are two bi-level programming problems. One bi-level problem is to determine a railway passenger-ticket average price strategy to meet .the objective of maximizing the consumer surplus under the condition of multi-modal transportation with elastic demand. The other bi-level problem is to determine the price of different kinds of the passenger trains to meet the objective of maximizing the railway revenue where the average price and the demand of the railway is determined. A heuristic algorithm for the two bi-level programming models is also proposed. Finally the applications of the model and its algorithm are illustrated with a numerical example.
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