Tolls Versus Mobility Permits: A Comparative Analysis
To address traffic congestion, two categories of instruments are used: price regulation (for instance, road pricing or congestion tolling) and quantity regulation (credit-based mobility schemes). Although the comparison of price and quantity regulation has received significant attention in the economics community, the literature is relatively sparse in the context of transportation systems. This paper develops a methodology to compare the toll and mobility permit instruments using a simple transportation network consisting of parallel highway routes and a public transport alternative. The permits can be traded across roads. The demand for each route is determined by a mixed logit route choice model and the supply consists of static congestion. The comparison is based on the optimum social welfare which is computed for each instrument by solving a non-convex optimization problem involving the mixed logit equilibrium constraints. Equity considerations are also examined. Numerical experiments conducted across a wide range of demand/supply inputs indicate that the toll and mobility permit instruments perform very closely in efficiency terms. The permit system is on average more efficient, but only by a small margin.
|Date of creation:||16 Nov 2016|
|Note:||View the original document on HAL open archive server: https://hal.archives-ouvertes.fr/hal-01397582|
|Contact details of provider:|| Web page: https://hal.archives-ouvertes.fr/|
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.:
- Hideo Konishi, 2004.
"Uniqueness of User Equilibrium in Transportation Networks with Heterogeneous Commuters,"
INFORMS, vol. 38(3), pages 315-330, August.
- Hideo Konishi, 2001. "Uniqueness of User Equilibrium in Transportation Networks with Heterogeneous Commuters," Boston College Working Papers in Economics 494, Boston College Department of Economics, revised 14 Nov 2002.
- Martin L. Weitzman, 1974. "Prices vs. Quantities," Review of Economic Studies, Oxford University Press, vol. 41(4), pages 477-491.
- Carlos F. Daganzo, 1983. "Stochastic Network Equilibrium with Multiple Vehicle Types and Asymmetric, Indefinite Link Cost Jacobians," Transportation Science, INFORMS, vol. 17(3), pages 282-300, August.
- De Borger, Bruno & Proost, Stef, 2012.
"A political economy model of road pricing,"
Journal of Urban Economics,
Elsevier, vol. 71(1), pages 79-92.
- Bruno DE BORGER & Stef PROOST, 2010. "A political economy model of road pricing," Working Papers Department of Economics ces10.20, KU Leuven, Faculty of Economics and Business, Department of Economics.
- DE BORGER, Bruno & PROOST, Stef, 2010. "A political economy model of road pricing," Working Papers 2010014, University of Antwerp, Faculty of Applied Economics.
- Fan, Wenbo & Jiang, Xinguo, 2013. "Tradable mobility permits in roadway capacity allocation: Review and appraisal," Transport Policy, Elsevier, vol. 30(C), pages 132-142.
- Parry, Ian W H & Bento, Antonio, 2001. " Revenue Recycling and the Welfare Effects of Road Pricing," Scandinavian Journal of Economics, Wiley Blackwell, vol. 103(4), pages 645-671, December.
- Parry, Ian W.H. & Bento, Antonio Miguel R., 1999. "Revenue recycling and the welfare effects of road pricing," Policy Research Working Paper Series 2253, The World Bank.
- Parry, Ian & Bento, Antonio, 1999. "Revenue Recycling and the Welfare Effects of Road Pricing," Discussion Papers dp-99-45, Resources For the Future.
- E Verhoef & P Nijkamp & P Rietveld, 1997. "Tradeable permits: their potential in the regulation of road transport externalities," Environment and Planning B: Planning and Design, Pion Ltd, London, vol. 24(4), pages 527-548, July.
- E Verhoef & P Nijkamp & P Rietveld, 1997. "Tradeable Permits: Their Potential in the Regulation of Road Transport Externalities," Environment and Planning B, , vol. 24(4), pages 527-548, August.
- Robin Lindsey, 2004. "Existence, Uniqueness, and Trip Cost Function Properties of User Equilibrium in the Bottleneck Model with Multiple User Classes," Transportation Science, INFORMS, vol. 38(3), pages 293-314, August.
- Roberts, Marc J. & Spence, Michael, 1976. "Effluent charges and licenses under uncertainty," Journal of Public Economics, Elsevier, vol. 5(3-4), pages 193-208.
- Jean Jacques Laffont, 1977. "More on Prices vs. Quantities," Review of Economic Studies, Oxford University Press, vol. 44(1), pages 177-182. Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:hal:cesptp:hal-01397582. 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: (CCSD)
If references are entirely missing, you can add them using this form.