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Cordon pricing in the monocentric city: theory and application to Paris region

  • André DE PALMA

    (Ecole Normale Supérieure de Cachan)

  • Moez KILANI

    (Université Charles de Gaulle - Lille, EQUIPPE)

  • Michel DE LARA

    (Université de Paris-Est, CERMICS)

  • Serge PIPERNO

    (Université de Paris-Est, CERMICS)

We propose a method to compute an equilibrium solution for the monocentric city model with traffic congestion, and to quantify the impact of cordon tolls on social surplus. The focus of this paper is on the comparison of road pricing of one and two cordons, with the no toll and first-best situations as benchmarks. We find that a one-cordon toll yields a social efficiency of 63% with respect to first-best, and that an optimal two-cordon toll increases the efficiency to 73%. Both policies have a positive impact on CO2 emissions because they reduce the average length of trips and reduce the road size.

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Paper provided by Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES) in its series Discussion Papers (REL - Recherches Economiques de Louvain) with number 2011027.

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Length: 20
Date of creation: 01 Sep 2011
Date of revision:
Handle: RePEc:ctl:louvre:2011027
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  1. de Palma, André & Lindsey, Robin, 2006. "Modelling and evaluation of road pricing in Paris," Transport Policy, Elsevier, vol. 13(2), pages 115-126, March.
  2. Fujita,Masahisa, 1991. "Urban Economic Theory," Cambridge Books, Cambridge University Press, number 9780521396455.
  3. Georgina Santos & Gordon Fraser, 2006. "Road pricing: lessons from London," Economic Policy, CEPR;CES;MSH, vol. 21(46), pages 263-310, 04.
  4. Ho, H.W. & Wong, S.C. & Yang, Hai & Loo, Becky P.Y., 2005. "Cordon-based congestion pricing in a continuum traffic equilibrium system," Transportation Research Part A: Policy and Practice, Elsevier, vol. 39(7-9), pages 813-834.
  5. Michel De Lara & André De Palma & Moez Kilani & Serge Piperno, 2008. "Congestion pricing and long term urban form: Application to Ile-de-France," Working Papers hal-00348439, HAL.
  6. Peter Mieszkowski & Edwin S. Mills, 1993. "The Causes of Metropolitan Suburbanization," Journal of Economic Perspectives, American Economic Association, vol. 7(3), pages 135-147, Summer.
  7. Kanemoto, Yoshitsugu, 1977. "Cost-benefit analysis and the second best land use for transportation," Journal of Urban Economics, Elsevier, vol. 4(4), pages 483-503, October.
  8. Verhoef, Erik T., 2005. "Second-best congestion pricing schemes in the monocentric city," Journal of Urban Economics, Elsevier, vol. 58(3), pages 367-388, November.
  9. Jonathan Leape, 2006. "The London Congestion Charge," Journal of Economic Perspectives, American Economic Association, vol. 20(4), pages 157-176, Fall.
  10. de Palma, André & Kilani, Moez & Lindsey, Robin, 2005. "Congestion pricing on a road network: A study using the dynamic equilibrium simulator METROPOLIS," Transportation Research Part A: Policy and Practice, Elsevier, vol. 39(7-9), pages 588-611.
  11. Robson, Arthur J., 1976. "Cost-benefit analysis and the use of urban land for transportation," Journal of Urban Economics, Elsevier, vol. 3(2), pages 180-191, April.
  12. Zhang, Xiaoning & Yang, Hai, 2004. "The optimal cordon-based network congestion pricing problem," Transportation Research Part B: Methodological, Elsevier, vol. 38(6), pages 517-537, July.
  13. Sumalee, Agachai & May, Tony & Shepherd, Simon, 2005. "Comparison of judgmental and optimal road pricing cordons," Transport Policy, Elsevier, vol. 12(5), pages 384-390, September.
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