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The political calculus of congestion pricing

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  • King, David
  • Manville, Michael
  • Shoup, Donald

Abstract

The political feasibility of using prices to mitigate congestion depends on who receives the toll revenue. We argue that congestion pricing on freeways will have the greatest chance of political success if the revenue is distributed to cities, and particularly to cities through which the freeways pass. In contrast to a number of previous proposals, we argue that cities are stronger claimants for the revenue than either individual drivers or regional authorities. We draw on theory from behavioral economics and political science to explain our proposal, and illustrate it with data from several metropolitan areas. In Los Angeles, where potential congestion toll revenues are estimated to be almost $5 billion a year, distributing toll revenues to cities with freeways could be politically effective and highly progressive.

Suggested Citation

  • King, David & Manville, Michael & Shoup, Donald, 2007. "The political calculus of congestion pricing," Transport Policy, Elsevier, vol. 14(2), pages 111-123, March.
  • Handle: RePEc:eee:trapol:v:14:y:2007:i:2:p:111-123
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    Cited by:

    1. repec:eee:ecotra:v:13:y:2018:i:c:p:1-3 is not listed on IDEAS
    2. Rouhani, Omid M. & Geddes, R. Richard & Gao, H. Oliver & Bel, Germà, 2016. "Social welfare analysis of investment public–private partnership approaches for transportation projects," Transportation Research Part A: Policy and Practice, Elsevier, vol. 88(C), pages 86-103.
    3. repec:eee:transa:v:107:y:2018:i:c:p:35-51 is not listed on IDEAS
    4. Hensher, David A. & Bliemer, Michiel C.J., 2014. "What type of road pricing scheme might appeal to politicians? Viewpoints on the challenge in gaining the citizen and public servant vote by staging reform," Transportation Research Part A: Policy and Practice, Elsevier, vol. 61(C), pages 227-237.
    5. Börjesson , Maria & Kristoffersson, Ida, 2017. "The Swedish congestion charges: ten years on: - and effects of increasing charging levels," Working papers in Transport Economics 2017:2, CTS - Centre for Transport Studies Stockholm (KTH and VTI).
    6. David Hensher & Corinne Mulley, 2014. "Complementing distance based charges with discounted registration fees in the reform of road user charges: the impact for motorists and government revenue," Transportation, Springer, vol. 41(4), pages 697-715, July.
    7. Russo, Antonio, 2013. "Voting on road congestion policy," Regional Science and Urban Economics, Elsevier, vol. 43(5), pages 707-724.
    8. Bruno Borger & Stef Proost, 2016. "The political economy of pricing and capacity decisions for congestible local public goods in a federal state," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 23(5), pages 934-959, October.
    9. Paul J. Burke, 2014. "Green Pricing in the Asia Pacific: An Idea Whose Time Has Come?," Asia and the Pacific Policy Studies, Wiley Blackwell, vol. 1(3), pages 561-575, September.
    10. repec:eee:transa:v:105:y:2017:i:c:p:79-94 is not listed on IDEAS
    11. De Borger, Bruno & Proost, Stef, 2012. "A political economy model of road pricing," Journal of Urban Economics, Elsevier, vol. 71(1), pages 79-92.
    12. Mirabel, François & Reymond, Mathias, 2011. "Bottleneck congestion pricing and modal split: Redistribution of toll revenue," Transportation Research Part A: Policy and Practice, Elsevier, vol. 45(1), pages 18-30, January.
    13. King, David A. & Gordon, Cameron E. & Peters, Jonathan R., 2014. "Does road pricing affect port freight activity: Recent evidence from the port of New York and New Jersey," Research in Transportation Economics, Elsevier, vol. 44(C), pages 2-11.
    14. 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.
    15. De Borger, Bruno & Proost, Stef, 2012. "Transport policy competition between governments: A selective survey of the literature," Economics of Transportation, Elsevier, vol. 1(1), pages 35-48.
    16. Vonk Noordegraaf, Diana & Annema, Jan Anne & van Wee, Bert, 2014. "Policy implementation lessons from six road pricing cases," Transportation Research Part A: Policy and Practice, Elsevier, vol. 59(C), pages 172-191.
    17. 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.
    18. Le Vine, Scott & Polak, John, 2016. "A novel peer-to-peer congestion pricing marketplace enabled by vehicle-automation," Transportation Research Part A: Policy and Practice, Elsevier, vol. 94(C), pages 483-494.
    19. Zhi-Chun Li & Ya-Dong Wang & William Lam & Agachai Sumalee & Keechoo Choi, 2014. "Design of Sustainable Cordon Toll Pricing Schemes in a Monocentric City," Networks and Spatial Economics, Springer, vol. 14(2), pages 133-158, June.
    20. Grisolía, José M. & López, Francisco & Ortúzar, Juan de Dios, 2015. "Increasing the acceptability of a congestion charging scheme," Transport Policy, Elsevier, vol. 39(C), pages 37-47.
    21. David Hensher, 2013. "Exploring the relationship between perceived acceptability and referendum voting support for alternative road pricing schemes," Transportation, Springer, vol. 40(5), pages 935-959, September.
    22. Kono, Tatsuhito & Joshi, Kirti Kusum & Kato, Takeaki & Yokoi, Takahisa, 2012. "Optimal regulation on building size and city boundary: An effective second-best remedy for traffic congestion externality," Regional Science and Urban Economics, Elsevier, vol. 42(4), pages 619-630.
    23. Michael Manville & David King, 2013. "Credible commitment and congestion pricing," Transportation, Springer, vol. 40(2), pages 229-249, February.

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