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Ameliorating Congestion by Income Redistribution

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  • Glazer, Amihai
  • Konrad, Kai A.

Abstract

Consider a community with individuals who consume a private good and use a congestible facility. Without a congestion fee, use of the congestible facility will exceed the socially optimal level. We show that under some conditions this externality problem can be solved by income redistribution. Indeed, the poor can gain from a redistribution to the rich.

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  • Glazer, Amihai & Konrad, Kai A., 1993. "Ameliorating Congestion by Income Redistribution," University of California Transportation Center, Working Papers qt7k0387sw, University of California Transportation Center.
    • Handle: RePEc:cdl:uctcwp:qt7k0387sw
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    References listed on IDEAS

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    1. Charles M. Tiebout, 1956. "A Pure Theory of Local Expenditures," Journal of Political Economy, University of Chicago Press, vol. 64(5), pages 416-416.
    2. Varian, Hal R., 1980. "Redistributive taxation as social insurance," Journal of Public Economics, Elsevier, vol. 14(1), pages 49-68, August.
    3. Niskanen, Esko, 1987. "Congestion tolls and consumer welfare," Transportation Research Part B: Methodological, Elsevier, vol. 21(2), pages 171-174, April.
    4. Michael J. Boskin & Eytan Sheshinski, 1978. "Optimal Redistributive Taxation When Individual Welfare Depends upon Relative Income," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 92(4), pages 589-601.
    5. Hochman, Harold M & Rodgers, James D, 1969. "Pareto Optimal Redistribution," American Economic Review, American Economic Association, vol. 59(4), pages 542-557, Part I Se.
    6. Romano, Richard E, 1991. "When Excessive Consumption Is Rational," American Economic Review, American Economic Association, vol. 81(3), pages 553-564, June.
    7. Evans, Alan W, 1992. "Road Congestion: The Diagrammatic Analysis: Comment," Journal of Political Economy, University of Chicago Press, vol. 100(1), pages 211-217, February.
    8. De Meza, David & Gould, J R, 1987. "Free Access versus Private Property in a Resource: Income Distributions Compared," Journal of Political Economy, University of Chicago Press, vol. 95(6), pages 1317-1325, December.
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    Cited by:

    1. Saving, Jason L., 1999. "Migration, labor-leisure choice, and Pareto suboptimal redistribution," Regional Science and Urban Economics, Elsevier, vol. 29(5), pages 559-573, September.
    2. Pedro Garcia-del-Barrio, 2017. "Pareto-improving income redistribution: expanding consumer access to the vaccines market," Economics of Governance, Springer, vol. 18(3), pages 275-313, August.

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