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Managing Road Capacity: Maintenance, Tolls, and Multi-Level Governance

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  • André De palma

    (CY Cergy Paris Université, THEMA)

Abstract

Road congestion and deteriorating infrastructure impose substantial economic and social costs, with estimates reaching up to 1% of GDP in highly congested economies. At the same time, public finances are increasingly constrained, and reliance on the “user-pays” principle has grown, prompting greater use of tolling schemes and private participation in financing, operating, and maintaining road networks. This paper examines the interaction between road maintenance, capacity, and pricing decisions in contexts where different operators share responsibilities. We analyze whether private maintenance and tolling strategies converge toward socially optimal outcomes, and under what conditions misalignments occur. Policy implications for optimal pricing, investment incentives, and the design of capacity and maintenance are discussed.

Suggested Citation

  • André De palma, 2025. "Managing Road Capacity: Maintenance, Tolls, and Multi-Level Governance," THEMA Working Papers 2025-14, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
    • Handle: RePEc:ema:worpap:2025-14
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    References listed on IDEAS

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    More about this item

    Keywords

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    JEL classification:

    • R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise
    • R42 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government and Private Investment Analysis; Road Maintenance; Transportation Planning
    • R48 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government Pricing and Policy
    • H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • L91 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Transportation: General

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