Marginal Social Cost Pricing for all Transport modes and the effects of modal budget constraints
This paper studies the order of magnitude of the pricing corrections that are needed to implement marginal social cost pricing for all transport modes. With the TRENEN model we study this question for 6 areas in the EU. As marginal social cost pricing may generate important surpluses and deficits for the different modes, we also study the effects of two alternative pricing rules that satisfy budget constraints. We examine the effects of average cost pricing that guarantees a budget balance per mode. The second alternative pricing rule we study is social Ramsey pricing (or marginal social cost pricing with a budget constraint) where we impose a budget constraint at the level of the transport sector. We estimate transport effects and welfare effects of the three pricing rules. We show that average pricing rules may actually do worse than the present pricing rules and that social Ramsey pricing may achieve 50% or more of the maximal welfare gain.
|Date of creation:||Oct 2003|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: +32-(0)16-32 67 25
Fax: +32-(0)16-32 67 96
Web page: http://www.econ.kuleuven.be/ew/academic/energmil
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- DE BORGER, Bruno, .
"Discrete choice models and optimal two-part tariffs in the presence of externalities: Optimal taxation of cars,"
2000021, University of Antwerp, Faculty of Applied Economics.
- De Borger, Bruno, 2001. "Discrete choice models and optimal two-part tariffs in the presence of externalities: optimal taxation of cars," Regional Science and Urban Economics, Elsevier, vol. 31(4), pages 471-504, July.
- Proost, S. & Van Dender, K. & Courcelle, C. & De Borger, B. & Peirson, J. & Sharp, D. & Vickerman, R. & Gibbons, E. & O'Mahony, M. & Heaney, Q. & Van den Bergh, J. & Verhoef, E., 2002.
"How large is the gap between present and efficient transport prices in Europe?,"
Elsevier, vol. 9(1), pages 41-57, January.
- Stef Proost & Kurt Van Dender & Christoph Courcelle & John Peirson & Duncan Sharp, 2001. "How large is the gap between present and efficient transport prices in Europe?," Chapters, in: Reforming Transport Pricing in the European Union, chapter 17 Edward Elgar.
- Stef Proost & Kurt Van Dender & C. Courcelle & B. De Borger & J. Peirson & D. Sharp & R. Vickerman & E. Gibbons & M. O'Mahony & Q. Heaney & J. Van den Bergh & E. Verhoef, 2001. "How large is the gap between present and efficient transport prices in Europe?," Energy, Transport and Environment Working Papers Series ete0120, Katholieke Universiteit Leuven, Centrum voor Economische Studiën, Energy, Transport and Environment.
When requesting a correction, please mention this item's handle: RePEc:ete:etewps:ete0311. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Isabelle)The email address of this maintainer does not seem to be valid anymore. Please ask Isabelle to update the entry or send us the correct address
If references are entirely missing, you can add them using this form.