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A cost-benefit analysis of tunnel investment and tolling alternatives in Antwerp

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  • Proost, S.
  • Van der Loo, S.
  • de Palma, Andre
  • Lindsey, Robin

Abstract

A proposal has been made to build a new tunnel under the Scheldt River near the centre of Antwerp in order to relieve traffic congestion on the ring road and in an existing tunnel. The new tunnel is expected to cost more than €1 billion, and tolls have been suggested to help finance construction and to manage demand. This paper conducts a preliminary cost-benefit analysis of a new tunnel and three alternative tolling schemes, and compares them with a do-nothing scenario and an option to toll the existing tunnel without building a new one. The two tunnels are treated as imperfect substitutes, and a multi-year accounting framework is adopted that accounts for emissions, accidents and noise externalities, road damage, revenues accruing to the national and regional governments from existing transport user charges, and the salvage value of the new tunnel. With the base-case parameter values it is found that building the tunnel is worthwhile with all three tolling regimes and yields a higher benefit than not building the tunnel and tolling the old one. Nevertheless, the net benefit from building the tunnel differs appreciably between tolling regimes, and it is sensitive to the value assumed for the marginal cost of public funds.

Suggested Citation

  • Proost, S. & Van der Loo, S. & de Palma, Andre & Lindsey, Robin, 2005. "A cost-benefit analysis of tunnel investment and tolling alternatives in Antwerp," European Transport \ Trasporti Europei, ISTIEE, Institute for the Study of Transport within the European Economic Integration, issue 31, pages 83-100.
    • Handle: RePEc:sot:journl:y:2005:i:31:p:83-100
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    References listed on IDEAS

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    Cited by:

    1. Cantos-Sánchez, Pedro & Moner-Colonques, Rafael & Sempere-Monerris, José J. & Álvarez-SanJaime, Óscar, 2011. "Viability of new road infrastructure with heterogeneous users," Transportation Research Part A: Policy and Practice, Elsevier, vol. 45(5), pages 435-450, June.
    2. de Palma, André & Lindsey, Robin & Proost, Stef & Van der Loo, Saskia, 2007. "Chapter 5 Comparing alternative pricing and revenue use strategies with the MOLINO model," Research in Transportation Economics, Elsevier, vol. 19(1), pages 111-131, January.
    3. Massiani, Jérôme & Maltese, Ila, 2022. "Thirty years of socio-economic evaluation of the Lyon–Turin High–Speed rail project," Research in Transportation Economics, Elsevier, vol. 94(C).
    4. de Palma, Andre & Marcucci, Edoardo & Niskanen, Esko & Wieland, Bernhard, 2005. "Introduction," European Transport \ Trasporti Europei, ISTIEE, Institute for the Study of Transport within the European Economic Integration, issue 31, pages 1-5.
    5. Pedro Cantos-Sanchez & Rafael Moner-Colonques & Jose J. Sempere-Monerris & Oscar Alvarez, 2008. "Viability of a New Road Infrastructure with Heterogeneous Users in Madrid Access," Working Papers 2008-06, FEDEA.
    6. Bushansky, S., 2021. "Inefficiency of road concessions in Russia: exception or rule?," Journal of the New Economic Association, New Economic Association, vol. 50(2), pages 97-118.

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    More about this item

    Keywords

    Infrastructure investment; Route choice; Congestion; Tolls;
    All these keywords.

    JEL classification:

    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • 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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