IDEAS home Printed from https://ideas.repec.org/a/eee/trapol/v114y2021icp88-103.html
   My bibliography  Save this article

Optimal pricing of car use in a small city: A case study of Uppsala

Author

Listed:
  • Asplund, Disa
  • Pyddoke, Roger

Abstract

Studies of cities that have successfully shifted demand from cars to more sustainable modes suggest that coordinated packages of mutually reinforcing policy instruments are needed. Congestion charges and parking fees can be important parts of such packages. This paper examines the introduction of welfare-optimal congestion charges and parking fees in a model calibrated to Uppsala, a small city in Sweden. These effects are modeled with a simple transport demand model for the welfare optimization of parking fees, congestion charges, and public transport provision. The results suggest that welfare-optimal congestion charges in Uppsala are as high as EUR 2.8 in peak hours and EUR 1.4 in off-peak hours. A rough cost–benefit analysis shows that the introduction of congestion charges in Uppsala is welfare improving if the operating costs of congestion charges are proportional to city population size. In the main scenarios, optimal congestion charges and parking fees reduce the number of car trips by 10% and 7%, respectively. The model can be used to assess when it is worthwhile to introduce congestion pricing.

Suggested Citation

  • Asplund, Disa & Pyddoke, Roger, 2021. "Optimal pricing of car use in a small city: A case study of Uppsala," Transport Policy, Elsevier, vol. 114(C), pages 88-103.
  • Handle: RePEc:eee:trapol:v:114:y:2021:i:c:p:88-103
    DOI: 10.1016/j.tranpol.2021.09.008
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0967070X21002730
    Download Restriction: Full text for ScienceDirect subscribers only

    File URL: https://libkey.io/10.1016/j.tranpol.2021.09.008?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Kobus, Martijn B.W. & Gutiérrez-i-Puigarnau, Eva & Rietveld, Piet & Van Ommeren, Jos N., 2013. "The on-street parking premium and car drivers' choice between street and garage parking," Regional Science and Urban Economics, Elsevier, vol. 43(2), pages 395-403.
    2. Ian W. H. Parry & Kenneth A. Small, 2009. "Should Urban Transit Subsidies Be Reduced?," American Economic Review, American Economic Association, vol. 99(3), pages 700-724, June.
    3. Jacobs, Bas & de Mooij, Ruud A., 2015. "Pigou meets Mirrlees: On the irrelevance of tax distortions for the second-best Pigouvian tax," Journal of Environmental Economics and Management, Elsevier, vol. 71(C), pages 90-108.
    4. Leonardo J. Basso & Hugo E. Silva, 2014. "Efficiency and Substitutability of Transit Subsidies and Other Urban Transport Policies," American Economic Journal: Economic Policy, American Economic Association, vol. 6(4), pages 1-33, November.
    5. Börjesson, Maria & Kristoffersson, Ida, 2018. "The Swedish congestion charges: Ten years on," Transportation Research Part A: Policy and Practice, Elsevier, vol. 107(C), pages 35-51.
    6. Eliasson, Jonas, 2016. "Is congestion pricing fair? Consumer and citizen perspectives on equity effects," Transport Policy, Elsevier, vol. 52(C), pages 1-15.
    7. Voith, Richard, 1998. "Parking, Transit, and Employment in a Central Business District," Journal of Urban Economics, Elsevier, vol. 44(1), pages 43-58, July.
    8. Eliasson, Jonas & Hultkrantz, Lars & Nerhagen, Lena & Rosqvist, Lena Smidfelt, 2009. "The Stockholm congestion - charging trial 2006: Overview of effects," Transportation Research Part A: Policy and Practice, Elsevier, vol. 43(3), pages 240-250, March.
    9. Ian W. H. Parry & Antonio Bento, 2001. "Revenue Recycling and the Welfare Effects of Road Pricing," Scandinavian Journal of Economics, Wiley Blackwell, vol. 103(4), pages 645-671, December.
    10. Fosgerau, Mogens & de Palma, André, 2013. "The dynamics of urban traffic congestion and the price of parking," Journal of Public Economics, Elsevier, vol. 105(C), pages 106-115.
    11. Kilani, Moez & Proost, Stef & van der Loo, Saskia, 2014. "Road pricing and public transport pricing reform in Paris: Complements or substitutes?," Economics of Transportation, Elsevier, vol. 3(2), pages 175-187.
    12. Arnott, Richard & de Palma, Andre & Lindsey, Robin, 1991. "A temporal and spatial equilibrium analysis of commuter parking," Journal of Public Economics, Elsevier, vol. 45(3), pages 301-335, August.
    13. van Wee, Bert & Börjesson, Maria, 2015. "How to make CBA more suitable for evaluating cycling policies," Transport Policy, Elsevier, vol. 44(C), pages 117-124.
    14. Standen, Christopher & Greaves, Stephen & Collins, Andrew T. & Crane, Melanie & Rissel, Chris, 2019. "The value of slow travel: Economic appraisal of cycling projects using the logsum measure of consumer surplus," Transportation Research Part A: Policy and Practice, Elsevier, vol. 123(C), pages 255-268.
    15. Mingardo, Giuliano & van Wee, Bert & Rye, Tom, 2015. "Urban parking policy in Europe: A conceptualization of past and possible future trends," Transportation Research Part A: Policy and Practice, Elsevier, vol. 74(C), pages 268-281.
    16. Glazer, Amihai & Niskanen, Esko, 1992. "Parking fees and congestion," Regional Science and Urban Economics, Elsevier, vol. 22(1), pages 123-132, March.
    17. Proost, Stef & Dender, Kurt Van, 2008. "Optimal urban transport pricing in the presence of congestion, economies of density and costly public funds," Transportation Research Part A: Policy and Practice, Elsevier, vol. 42(9), pages 1220-1230, November.
    18. Ralph Buehler & John Pucher & Regine Gerike & Thomas Götschi, 2017. "Reducing car dependence in the heart of Europe: lessons from Germany, Austria, and Switzerland," Transport Reviews, Taylor & Francis Journals, vol. 37(1), pages 4-28, January.
    19. Hensher, David A. & King, Jenny, 2001. "Parking demand and responsiveness to supply, pricing and location in the Sydney central business district," Transportation Research Part A: Policy and Practice, Elsevier, vol. 35(3), pages 177-196, March.
    20. Börjesson, Maria & Fung, Chau Man & Proost, Stef, 2017. "Optimal prices and frequencies for buses in Stockholm," Economics of Transportation, Elsevier, vol. 9(C), pages 20-36.
    21. Armelius, Hanna & Hultkrantz, Lars, 2006. "The politico-economic link between public transport and road pricing: An ex-ante study of the Stockholm road-pricing trial," Transport Policy, Elsevier, vol. 13(2), pages 162-172, March.
    22. Börjesson, Maria & Kristoffersson, Ida, 2015. "The Gothenburg congestion charge. Effects, design and politics," Transportation Research Part A: Policy and Practice, Elsevier, vol. 75(C), pages 134-146.
    23. Mark R. Stevens, 2017. "Response to Commentaries on “Does Compact Development Make People Drive Less?”," Journal of the American Planning Association, Taylor & Francis Journals, vol. 83(2), pages 151-158, April.
    24. Pyddoke, Roger & Swärdh, Jan-Erik, 2015. "Differences in the effects of fuel price and income on private car use in Sweden 1999-2008," Working papers in Transport Economics 2015:1, CTS - Centre for Transport Studies Stockholm (KTH and VTI).
    25. Edward Calthrop & Stef Proost & Kurt van Dender, 2000. "Parking Policies and Road Pricing," Urban Studies, Urban Studies Journal Limited, vol. 37(1), pages 63-76, January.
    26. Gragera, Albert & Albalate, Daniel, 2016. "The impact of curbside parking regulation on garage demand," Transport Policy, Elsevier, vol. 47(C), pages 160-168.
    27. Inci, Eren, 2015. "A review of the economics of parking," Economics of Transportation, Elsevier, vol. 4(1), pages 50-63.
    28. Mark R. Stevens, 2017. "Does Compact Development Make People Drive Less?," Journal of the American Planning Association, Taylor & Francis Journals, vol. 83(1), pages 7-18, January.
    29. Asplund, Disa & Pyddoke, Roger, 2020. "Optimal fares and frequencies for bus services in a small city," Research in Transportation Economics, Elsevier, vol. 80(C).
    30. Calthrop, Edward & Proost, Stef, 2006. "Regulating on-street parking," Regional Science and Urban Economics, Elsevier, vol. 36(1), pages 29-48, January.
    31. Pyddoke , Roger & Norheim, Bård & Betanzo , Mari Fossheim, 2017. "A model for strategic planning of sustainable urban transport in Scandinavia: a case study of Uppsala," Working papers in Transport Economics 2017:7, CTS - Centre for Transport Studies Stockholm (KTH and VTI).
    32. Theodore Tsekeris & Stefan Voß, 2009. "Design and evaluation of road pricing: state-of-the-art and methodological advances," Netnomics, Springer, vol. 10(1), pages 5-52, April.
    33. Nourinejad, Mehdi & Roorda, Matthew J., 2017. "Impact of hourly parking pricing on travel demand," Transportation Research Part A: Policy and Practice, Elsevier, vol. 98(C), pages 28-45.
    34. Wadud, Zia, 2017. "Fully automated vehicles: A cost of ownership analysis to inform early adoption," Transportation Research Part A: Policy and Practice, Elsevier, vol. 101(C), pages 163-176.
    35. Fosgerau, Mogens & de Palma, André, 2013. "The dynamics of urban traffic congestion and the price of parking�," MPRA Paper 48433, University Library of Munich, Germany.
    36. Parry, Ian W H & Bento, Antonio, 2001. "Revenue Recycling and the Welfare Effects of Road Pricing," Scandinavian Journal of Economics, Wiley Blackwell, vol. 103(4), pages 645-671, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Pyddoke, Roger & Thoresson, Karin, 2023. "Has collaboration contributed to goal achievement in Swedish public transport?," Research in Transportation Economics, Elsevier, vol. 99(C).
    2. Börjesson, Maria & Asplund, Disa & Hamilton, Carl, 2023. "Optimal kilometre tax for electric vehicles," Transport Policy, Elsevier, vol. 134(C), pages 52-64.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Asplund, Disa & Pyddoke, Roger, 2019. "Optimal pricing of car use in a small city: a case study of Uppsala," Papers 2019:2, Research Programme in Transport Economics.
    2. Gragera, Albert & Hybel, Jesper & Madsen, Edith & Mulalic, Ismir, 2021. "A model for estimation of the demand for on-street parking," Economics of Transportation, Elsevier, vol. 28(C).
    3. Inci, Eren, 2015. "A review of the economics of parking," Economics of Transportation, Elsevier, vol. 4(1), pages 50-63.
    4. Pons-Rigat, Aleix & Proost, Stef & Turró, Mateu, 2020. "Workplace parking policies in an agglomeration: An illustration for Barcelona," Economics of Transportation, Elsevier, vol. 24(C).
    5. Krishnamurthy, Chandra Kiran B. & Ngo, Nicole S., 2020. "The effects of smart-parking on transit and traffic: Evidence from SFpark," Journal of Environmental Economics and Management, Elsevier, vol. 99(C).
    6. Inci, Eren & Lindsey, Robin, 2015. "Garage and curbside parking competition with search congestion," Regional Science and Urban Economics, Elsevier, vol. 54(C), pages 49-59.
    7. Hörcher, Daniel & Tirachini, Alejandro, 2021. "A review of public transport economics," Economics of Transportation, Elsevier, vol. 25(C).
    8. Pyddoke, Roger, 2023. "Comparison of policies for increasing sustainable transport mode shares in Swedish cities," Working Papers 2023:9, Swedish National Road & Transport Research Institute (VTI).
    9. Asplund, Disa & Pyddoke, Roger, 2020. "Optimal fares and frequencies for bus services in a small city," Research in Transportation Economics, Elsevier, vol. 80(C).
    10. Vandyck, Toon & Rutherford, Thomas F., 2018. "Regional labor markets, commuting, and the economic impact of road pricing," Regional Science and Urban Economics, Elsevier, vol. 73(C), pages 217-236.
    11. Zipeng Zhang & Ning Zhang, 2021. "Early Bird Scheme for Parking Management: How Does Parking Play a Role in the Morning Commute Problem," Sustainability, MDPI, vol. 13(15), pages 1-19, July.
    12. Takayama, Yuki & Kuwahara, Masao, 2016. "Scheduling preferences, parking competition, and bottleneck congestion: A model of trip timing and parking location choices by heterogeneous commuters," MPRA Paper 68938, University Library of Munich, Germany.
    13. Santos, Georgina & Behrendt, Hannah & Maconi, Laura & Shirvani, Tara & Teytelboym, Alexander, 2010. "Part I: Externalities and economic policies in road transport," Research in Transportation Economics, Elsevier, vol. 28(1), pages 2-45.
    14. Amer, Ahmed & Chow, Joseph Y.J., 2017. "A downtown on-street parking model with urban truck delivery behavior," Transportation Research Part A: Policy and Practice, Elsevier, vol. 102(C), pages 51-67.
    15. Lehner, Stephan & Peer, Stefanie, 2019. "The price elasticity of parking: A meta-analysis," Transportation Research Part A: Policy and Practice, Elsevier, vol. 121(C), pages 177-191.
    16. Hörcher, Daniel & De Borger, Bruno & Seifu, Woubit & Graham, Daniel J., 2020. "Public transport provision under agglomeration economies," Regional Science and Urban Economics, Elsevier, vol. 81(C).
    17. Guillaume Monchambert & Stef Proost, 2019. "How Efficient are Intercity Railway Prices and Frequencies in Europe?: Comparing a Corridor in Belgium and in France," Journal of Transport Economics and Policy, University of Bath, vol. 53(4), pages 323-32-347.
    18. Lu, Xiao-Shan & Guo, Ren-Yong & Huang, Hai-Jun & Xu, Xiaoming & Chen, Jiajia, 2021. "Equilibrium analysis of parking for integrated daily commuting," Research in Transportation Economics, Elsevier, vol. 90(C).
    19. Liu, Wei & Geroliminis, Nikolas, 2016. "Modeling the morning commute for urban networks with cruising-for-parking: An MFD approach," Transportation Research Part B: Methodological, Elsevier, vol. 93(PA), pages 470-494.
    20. Lu, Xiao-Shan & Huang, Hai-Jun & Guo, Ren-Yong & Xiong, Fen, 2021. "Linear location-dependent parking fees and integrated daily commuting patterns with late arrival and early departure in a linear city," Transportation Research Part B: Methodological, Elsevier, vol. 150(C), pages 293-322.

    More about this item

    Keywords

    Congestion charges; Parking; Pricing; Demand; Optimization; Urban; Welfare;
    All these keywords.

    JEL classification:

    • 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
    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:trapol:v:114:y:2021:i:c:p:88-103. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/30473/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.