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Road User Charges in Britain

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  • Newbery, David M G

Abstract

At present the Department of Transport allocates road use costs according to concepts of fair attribution, and road user charges for commercial vehicles are intended to cover these costs. The paper calculates the efficient road user charge - the marginal social cost of highway use - and compares these figures with the cost allocation results. Recent research suggests that the efficient road damage charge is only about 40 percent of the total damage, but that congestion costs may more than compensate for this shortfall. This is confirmed for the United Kingdom, where the efficient charge for cars is shown to be higher than their allocated cost, but for heavy goods vehicles is about the same. Accident costs may substantially raise these figures.

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Bibliographic Info

Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 174.

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Date of creation: Apr 1987
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Handle: RePEc:cpr:ceprdp:174

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Related research

Keywords: Automobile Vehicles; Congestion Costs; Externalities; Highway Cost Allocation; Road User Charges; Transport Taxation;

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Citations

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Cited by:
  1. Andrew Dickerson & John Peirson & Roger Vickerman, 1998. "Road Accidents and Traffic Flows: An Econometric Investigation," Studies in Economics 9809, Department of Economics, University of Kent.
  2. Simon Shepherd, 2008. "The effect of complex models of externalities on estimated optimal tolls," Transportation, Springer, vol. 35(4), pages 559-577, July.
  3. Heike Link, 2003. "Estimates of marginal infrastructure costs for different modes of transport," ERSA conference papers ersa03p75, European Regional Science Association.
  4. Johansson-Stenman, Olof, 2006. "Optimal environmental road pricing," Economics Letters, Elsevier, vol. 90(2), pages 225-229, February.
  5. Strøm, Steinar & Vislie, Jon, 2008. "A Discrete-Choice Model Approach to Optimal Congestion Change," Memorandum 09/2008, Oslo University, Department of Economics.
  6. Ian W. H. Parry & Kenneth A. Small, 2005. "Does Britain or the United States Have the Right Gasoline Tax?," American Economic Review, American Economic Association, vol. 95(4), pages 1276-1289, September.
  7. Parry, Ian, 2003. "Comparing Alternative Policies to Reduce Traffic Accidents," Discussion Papers dp-03-07, Resources For the Future.
  8. Daniel Albalate & Germa Bel, 2008. "Motorways, tolls and road safety.Evidence from European Panel Data," IREA Working Papers 200802, University of Barcelona, Research Institute of Applied Economics, revised Feb 2008.
  9. Parry, Ian W. H. & Bento, Antonio, 2002. "Estimating the Welfare Effect of Congestion Taxes: The Critical Importance of Other Distortions within the Transport System," Journal of Urban Economics, Elsevier, vol. 51(2), pages 339-365, March.
  10. David M. Newbery & Georgina Santos, 1999. "Road taxes, road user charges and earmarking," Fiscal Studies, Institute for Fiscal Studies, vol. 20(2), pages 103-132, June.

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