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Introduction vs. price change of road toll – a panel data analysis of revealed preferences

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  • Bayer, Stian Brosvik
  • Flügel, Stefan

Abstract

Cordon-based congestion charging systems effectively reduce traffic, with initial implementations often achieving 15–20 % reductions in vehicle volumes, as observed in Singapore, London, and Stockholm. However, subsequent toll increases typically produce much smaller elasticities, a phenomenon known as "Large Elasticity at Introduction" (LEI). This suggests that introducing tolls on previously free roads triggers stronger behavioral responses than adjusting toll rates on already tolled roads.

Suggested Citation

  • Bayer, Stian Brosvik & Flügel, Stefan, 2025. "Introduction vs. price change of road toll – a panel data analysis of revealed preferences," Research in Transportation Economics, Elsevier, vol. 112(C).
    • Handle: RePEc:eee:retrec:v:112:y:2025:i:c:s0739885925000757
    DOI: 10.1016/j.retrec.2025.101592
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    Keywords

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    JEL classification:

    • R4 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics
    • R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise
    • R48 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government Pricing and Policy

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