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Transport policy for a post-Covid UK

Author

Listed:
  • Newbery, D.

Abstract

Transport policy needs reform. Future Government investment and fiscal policy needs re-orienting to stimulate the economy after the Covid-19 lock-down. Prices used in project appraisal must include all external effects, committing to proper social cost-benefit analysis. In consequence, fuel duty rates need to be more than doubled as a prelude to proper road pricing. Transport investment needs to be increased even with proper road pricing and more allocated to walking and cycling, guided by benefit-cost ratios, following Eddington’s recommendations. The paper gives five reasons for raising fuel duty rates, more on diesel than petrol, and estimates the desired levels.

Suggested Citation

  • Newbery, D., 2020. "Transport policy for a post-Covid UK," Cambridge Working Papers in Economics 2081, Faculty of Economics, University of Cambridge.
    • Handle: RePEc:cam:camdae:2081
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    References listed on IDEAS

    as
    1. Newbery, D., 2005. "Why Tax Energy? Towards a More Rational Energy Policy," Cambridge Working Papers in Economics 0508, Faculty of Economics, University of Cambridge.
    2. repec:ejw:journl:v:3:y:2006:i:2:p:292-379 is not listed on IDEAS
    3. Newbery, David M, 1990. "Pricing and Congestion: Economic Principles Relevant to Pricing Roads," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 6(2), pages 22-38, Summer.
    4. Small, Kenneth A., 2005. "Unnoticed Lessons from London," University of California Transportation Center, Working Papers qt4fv237ht, University of California Transportation Center.
    5. Santos, Georgina, 2017. "Road fuel taxes in Europe: Do they internalize road transport externalities?," Transport Policy, Elsevier, vol. 53(C), pages 120-134.
    6. Deaton, Angus & Stern, Nicholas, 1986. "Optimally uniform commodity taxes, taste differences and lump-sum grants," Economics Letters, Elsevier, vol. 20(3), pages 263-266.
    7. repec:aen:journl:2005v26-03-a01 is not listed on IDEAS
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

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    JEL classification:

    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • 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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