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Reforming transport pricing: an economist's perspective on equity, efficiency and acceptability

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  • Inge Mayeres

    ()
    (K.U.Leuven, C.E.S., Energy, Transport and Environment)

  • Stef Proost

    ()
    (K.U.Leuven, C.E.S., Energy, Transport and Environment)

Abstract

This paper applies the traditional definition of equity and efficiency in economics to transport pricing. It is shown how this framework can also be used to define acceptability. The problems and potential of this approach are illustrated by examining the effects for Belgium of replacing current transport pricing by marginal social cost pricing. The welfare effects on different income groups of this pricing reform are shown for different income groups using a computable general equilibrium model. We demonstrate how the efficiency, equity and acceptability of the reform depend not only on the change in transport prices but also on the way the extra tax revenues are used. We compare the effects of the use of net tax revenues for higher social transfers and for lower labour taxes.

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File URL: http://www.econ.kuleuven.ac.be/ew/academic/energmil/downloads/ETE-WP-2002-12.PDF
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Bibliographic Info

Paper provided by Katholieke Universiteit Leuven, Centrum voor Economische Studiën, Energy, Transport and Environment in its series Energy, Transport and Environment Working Papers Series with number ete0212.

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Length: 16 pages
Date of creation: Sep 2002
Date of revision:
Handle: RePEc:ete:etewps:ete0212

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Related research

Keywords: transport economics; externalities; externality tax; equity; efficiency; political acceptability;

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Cited by:
  1. Jonas Westin, 2011. "Labor Market Effects of Road Pricing in a Population with Continuously Distributed Value of Time," ERSA conference papers ersa10p1458, European Regional Science Association.
  2. Inge Mayeres & Stef Proost, 2004. "Towards better transport pricing and taxation in Belgium," Reflets et perspectives de la vie économique, De Boeck Université, vol. 0(4), pages 23-43.
  3. Abbes, Souhir, 2007. "Marginal social cost pricing in European seaports," European Transport \ Trasporti Europei, ISTIEE, Institute for the Study of Transport within the European Economic Integration, issue 36, pages 4-26.

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