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The Welfare Effects Of Congestion Tolls With Heterogeneous Commuters

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Author Info

  • Richard Arnott

    (Department Of Economics, Boston College)

  • Andre de Palma

    (University Of Geneva)

  • Robin Lindsey

    (University Of Alberta)

Abstract

Recent success in introducing road pricing, as well as recent polls suggest that road pricing schemes are politically viable if a large majority of drivers benefit. In this paper we analyze the welfare effects of an optimal time-varying toll impose during the morning commute. The toll tends to benefit drivers with high unit values of travel time and schedule delay. Other drivers can become worse off even with an equal per-capita rebate. A capacity expansion benefits drivers in proportion to their trip costs. If initial capacity is sufficiently small, a toll-financed expansion leaves all drivers better off.

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Bibliographic Info

Paper provided by Boston College Department of Economics in its series Boston College Working Papers in Economics with number 231.

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Date of creation: Dec 1993
Date of revision:
Handle: RePEc:boc:bocoec:231

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Cited by:
  1. Daniel Albalate & Germa Bel, 2008. "Shaping urban traffic patterns through congestion charging: What factors drive success or failure?," IREA Working Papers 200801, University of Barcelona, Research Institute of Applied Economics, revised Jan 2008.
  2. Parry, Ian W.H. & Walls, Margaret & Harrington, Winston, 2007. "Automobile Externalities and Policies," Discussion Papers dp-06-26, Resources For the Future.
  3. Erik Verhoef & Jan Rouwendal & Piet Rietveld, 1997. "Congestion caused by Speed Differences," Tinbergen Institute Discussion Papers 97-105/3, Tinbergen Institute.
  4. Eduardo Engel & Ronald Fischer & Alexander Galetovic, 1999. "Toll competition among congested roads," Documentos de Trabajo 54, Centro de Economía Aplicada, Universidad de Chile.
  5. Ch'ng, Kean Siang, 2010. "Individual tradable permit market and traffic congestion: An experimental study," MPRA Paper 26638, University Library of Munich, Germany.
  6. Romeo Danielis & Edoardo Marcucci, 1999. "Bottleneck Congestion and Modal Split Revisited," Working Papers 1999.5, Fondazione Eni Enrico Mattei.
  7. Vincent van den Berg & Erik T. Verhoef, 2010. "Why Congestion Tolling could be good for the Consumer: The Effects of Heterogeneity in the Values of Schedule Delay and Time on the Effects of Tolling," Tinbergen Institute Discussion Papers 10-016/3, Tinbergen Institute, revised 02 Aug 2012.
  8. Martin Koning, 2010. "The Social Cost of Road Congestion in Ile-de-France Region (and France): Empirical Evidences from the Paris Ring-Road," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00467888, HAL.
  9. Fosgerau, Mogens & de Palma, André, 2012. "Congestion in a city with a central bottleneck," Journal of Urban Economics, Elsevier, vol. 71(3), pages 269-277.
  10. André de Palma & Néjia Zaouali, 2007. "Monétarisation des externalités de transport : un état de l'art," THEMA Working Papers 2007-08, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
  11. Wuping Xin & David Levinson, 2006. "Stochastic congestion and pricing model with endogenous departure time selection and heterogeneous travelers," Working Papers 000029, University of Minnesota: Nexus Research Group.
  12. Timilsina, Govinda R. & Dulal, Hari B., 2008. "Fiscal policy instruments for reducing congestion and atmospheric emissions in the transport sector : a review," Policy Research Working Paper Series 4652, The World Bank.
  13. Erik Verhoef, 1997. "Time-Varying Tolls in a Dynamic Model of Road Traffic Congestion with Elastic Demand," Tinbergen Institute Discussion Papers 97-028/3, Tinbergen Institute.
  14. Christelle Viauroux, 2007. "Optimal pricing of endogenous congestion: a disaggregated approach," UMBC Economics Department Working Papers 09-107, UMBC Department of Economics, revised Apr 2011.
  15. Börjesson, Maria & Eliasson, Jonas & Hugosson, Muriel & Brundell-Freij, Karin, 2012. "The Stockholm congestion charges – five years on. Effects, acceptability and lessons learnt," Working papers in Transport Economics 2012:3, CTS - Centre for Transport Studies Stockholm (KTH and VTI).
  16. Erik Verhoef & Mark Lijesen, 1998. "The Economic Effects of Road Pricing in the Randstad Area," Tinbergen Institute Discussion Papers 98-078/3, Tinbergen Institute.
  17. Lisa Schweitzer & Brian Taylor, 2008. "Just pricing: the distributional effects of congestion pricing and sales taxes," Transportation, Springer, vol. 35(6), pages 797-812, November.
  18. Richard Arnott, 1997. "Congestion Tolling and Urban Spatial Structure," Boston College Working Papers in Economics 389., Boston College Department of Economics.

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