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Green Cars Sterilize Congestion Charges: A Model Analysis Of The Reduced Impact Of Stockholm Road Tolls

Author

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  • Hultkrantz, Lars

    () (Department of Business, Economics, Statistics and Informatics)

  • Liu, Xing

    () (Department of Business, Economics, Statistics and Informatics)

Abstract

Beforeafter comparisons indicate that the impact of the road toll in Stockholm on traffic volumes was smaller when the system was reopened in 2007, compared to the effect during the trial in 2006. We calibrate a modalchoice model on data for Stockholm from before and during the trial and use it to simulate the effects of some seemingly subtle changes of the design of the congestioncharge scheme. We find that the growth of the share of exempted ”green” cars and the decision to make charges deductible from the income tax may have considerably reduced the positive welfare effect of the toll.

Suggested Citation

  • Hultkrantz, Lars & Liu, Xing, 2009. "Green Cars Sterilize Congestion Charges: A Model Analysis Of The Reduced Impact Of Stockholm Road Tolls," Working Papers 2009:16, Örebro University, School of Business.
  • Handle: RePEc:hhs:oruesi:2009_016
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    References listed on IDEAS

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    1. Eliasson, Jonas, 2009. "A cost-benefit analysis of the Stockholm congestion charging system," Transportation Research Part A: Policy and Practice, Elsevier, vol. 43(4), pages 468-480, May.
    2. Glazer, Amihai & Niskanen, Esko, 2000. "Which consumers benefit from congestion tolls?," University of California Transportation Center, Working Papers qt33d88115, University of California Transportation Center.
    3. Isaksson, Karolina & Richardson, Tim, 2009. "Building legitimacy for risky policies: The cost of avoiding conflict in Stockholm," Transportation Research Part A: Policy and Practice, Elsevier, vol. 43(3), pages 251-257, March.
    4. Kottenhoff, Karl & Brundell Freij, Karin, 2009. "The role of public transport for feasibility and acceptability of congestion charging - The case of Stockholm," Transportation Research Part A: Policy and Practice, Elsevier, vol. 43(3), pages 297-305, March.
    5. Eliasson, Jonas & Hultkrantz, Lars & Nerhagen, Lena & Rosqvist, Lena Smidfelt, 2009. "The Stockholm congestion - charging trial 2006: Overview of effects," Transportation Research Part A: Policy and Practice, Elsevier, vol. 43(3), pages 240-250, March.
    6. Winslott-Hiselius, Lena & Brundell-Freij, Karin & Vagland, Asa & Byström, Camilla, 2009. "The development of public attitudes towards the Stockholm congestion trial," Transportation Research Part A: Policy and Practice, Elsevier, vol. 43(3), pages 269-282, March.
    7. Armelius, Hanna & Hultkrantz, Lars, 2006. "The politico-economic link between public transport and road pricing: An ex-ante study of the Stockholm road-pricing trial," Transport Policy, Elsevier, pages 162-172.
    8. Börjesson, Maria & Eliasson, Jonas & Hugosson, Muriel B. & Brundell-Freij, Karin, 2012. "The Stockholm congestion charges—5 years on. Effects, acceptability and lessons learnt," Transport Policy, Elsevier, pages 1-12.
    9. Small, Kenneth A. & Yan, Jia, 2001. "The Value of "Value Pricing" of Roads: Second-Best Pricing and Product Differentiation," Journal of Urban Economics, Elsevier, vol. 49(2), pages 310-336, March.
    10. Richard Arnott & An Yan, 2000. "The Two-Mode Problem: Second-Best Pricing and Capacity," Boston College Working Papers in Economics 474, Boston College Department of Economics.
    11. Hutlkrantz, Lars & Armelius, Hanna, 2005. "The Politico-Economic Link Between Public Transport And Road Pricing: An Ex-Ante Study Of The Stockholm Road-Pricing Trial," Working Papers 2005:8, Örebro University, School of Business.
    12. Kutzbach, Mark J., 2009. "Motorization in developing countries: Causes, consequences, and effectiveness of policy options," Journal of Urban Economics, Elsevier, vol. 65(2), pages 154-166, March.
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    Cited by:

    1. Jonas Westin, 2011. "Labor Market Effects of Road Pricing in a Population with Continuously Distributed Value of Time," ERSA conference papers ersa10p1458, European Regional Science Association.
    2. André De Palma & Robin Lindsey, 2009. "Traffic Congestion Pricing Methods and Technologies," Working Papers hal-00414526, HAL.
    3. Whitehead, Jake & Franklin, Joel P. & Washington, Simon, 2014. "The impact of a congestion pricing exemption on the demand for new energy efficient vehicles in Stockholm," Transportation Research Part A: Policy and Practice, Elsevier, vol. 70(C), pages 24-40.
    4. Shewmake, Sharon & Jarvis, Lovell, 2014. "Hybrid cars and HOV lanes," Transportation Research Part A: Policy and Practice, Elsevier, vol. 67(C), pages 304-319.

    More about this item

    Keywords

    congestion pricing; equity effects; modal choice;

    JEL classification:

    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures
    • R48 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government Pricing and Policy

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