Land use, congestion and urban management

In this paper we discuss the role that different instruments of pricing policy could play in promoting an efficient use of land, that is becoming a more and more scarce good through time. The main area where pricing instruments should be employed is the transport sector, particularly in urban areas. A growing experience has been accumulated during the last years and pricing for the use of roads, either through parking fees or through electronic road pricing, has been experimented in many countries with results that seem encouraging. One important conclusion that emerges from our analysis is that, notwithstanding these positive results, pricing policy for the use of roads is a necessary condition for getting efficient results, but by itself is not sufficient. Equally important is the need to integrate pricing mechanisms within land use planning, but both theory and practice are lacking on a wide range of issues related to the land use impacts of road pricing.