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Inefficiencies in regional commuting policy

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  • Toon VANDYCK
  • Stef PROOST

Abstract

This paper discusses investments in transport infrastructure and incentives for commuting taxes in a multiregional setting. We study the horizontal and vertical interactions between governments. We identify incentives for strategic and tax exporting behavior that might lead to underinvestment in transport infrastructure. Furthermore, we show that the intensity of the strategic behavior is affected by geographic firm ownership structure, the number of labor-supplying regions and the revenue-sharing mechanism in the federation. A numerical example applies the insights on commuting in Belgium.

Suggested Citation

  • Toon VANDYCK & Stef PROOST, 2011. "Inefficiencies in regional commuting policy," Working Papers of Department of Economics, Leuven ces11.18, KU Leuven, Faculty of Economics and Business (FEB), Department of Economics, Leuven.
    • Handle: RePEc:ete:ceswps:ces11.18
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    2. Hörcher, Daniel & Tirachini, Alejandro, 2021. "A review of public transport economics," Economics of Transportation, Elsevier, vol. 25(C).
    3. Wang, Han & Tian, Qiong & Huang, Hai-Jun, 2024. "The effects of commuting subsidies in a competitive two-city system," Transport Policy, Elsevier, vol. 154(C), pages 129-141.
    4. De Borger, Bruno & Proost, Stef, 2015. "The political economy of public transport pricing and supply decisions," Economics of Transportation, Elsevier, vol. 4(1), pages 95-109.
    5. Dong, Tao & Jia, Ning & Ma, Shoufeng & Xu, Shu-Xian & Ping Ong, Ghim & Liu, Peng & Huang, Hai-Jun, 2022. "Impacts of intercity commuting on travel characteristics and urban performances in a two-city system," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 164(C).
    6. Hörcher, Daniel & De Borger, Bruno & Graham, Daniel J., 2023. "Subsidised transport services in a fiscal federation: Why local governments may be against decentralised service provision," Economics of Transportation, Elsevier, vol. 34(C).
    7. Wang, Junjie & Liao, Feixiong & Wu, Jianjun & Xu, Zhongzhi & Gao, Ziyou, 2024. "Resilience assessment of intercity transport in a two-city system," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 189(C).
    8. Angela Stefania Bergantino & Leonardo Madio, 2015. "The Travel-to-work. Which factors matter? An analysis on regional labor market in UK," ERSA conference papers ersa15p888, European Regional Science Association.
    9. Wang, Han & Huang, Hai-Jun, 2024. "Effects of high-speed rail on intercity travels, utility and social welfare in urban agglomerations: A game-theoretic perspective," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 192(C).
    10. Vandyck, Toon & Rutherford, Thomas F., 2018. "Regional labor markets, commuting, and the economic impact of road pricing," Regional Science and Urban Economics, Elsevier, vol. 73(C), pages 217-236.

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