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Equity Effects of Road Pricing, A Review

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  • David Levinson

    () (Nexus (Networks, Economics, and Urban Systems) Research Group, Department of Civil Engineering, University of Minnesota)

Abstract

Are road pricing strategies regressive or progressive? This is a question that has been confronting researchers, practitioners, and policy-makers who seek to implement new mechanisms to raise funds for transportation while simultaneously managing demand. The theoretical literature is mixed, as is the empirical literature. In part this has to do with the various types of road pricing strategies that are being debated, different definitions of equity, and alternative assumptions about revenue recycling. Despite this seeming complexity, the literature is clear that equity issues are addressable. This paper provides a synthesis of the literature to date on both the theory of equity, as applied to road pricing, and the findings of empirical and simulation studies of the effects of particular implementations of road pricing, and suggested remedies for real or perceived inequities. To summarize, while there are certainly potential issues with equity associated with road pricing, those issues can be addressed with intelligent mechanism design that provides the right incentives to travelers and uses the raised revenues in a way to achieve desired equitable ends. These include cutting other taxes and investing in infrastructure and services.

Suggested Citation

  • David Levinson, 2009. "Equity Effects of Road Pricing, A Review," Working Papers 201006, University of Minnesota: Nexus Research Group.
  • Handle: RePEc:nex:wpaper:transportequityreviewpaper
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    File URL: http://hdl.handle.net/11299/179999
    File Function: First version, 2009
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    References listed on IDEAS

    as
    1. Aaron S. Edlin & Pinar Karaca-Mandic, 2006. "The Accident Externality from Driving," Journal of Political Economy, University of Chicago Press, vol. 114(5), pages 931-955, October.
    2. Morency, Catherine & Trépanier, Martin & Demers, Marie, 2011. "Walking to transit: An unexpected source of physical activity," Transport Policy, Elsevier, vol. 18(6), pages 800-806, November.
    3. repec:aph:ajpbhl:2003:93:9:1546-1551_1 is not listed on IDEAS
    4. P. Filliger & M. Herry & F. Horak & V. Puybonnieux-Texier & P. Quenel & J. Schneider & R.K. Seethaler & J.C. Vernaud & H. Sommer & N. Künzli & R. Kaiser & S. Medina & M. Studnicka & Olivier Chanel, 2000. "Public-health impact of outdoor and traffic-related air pollution: a European assessment," Post-Print hal-01462907, HAL.
    5. Richard Wener & Gary Evans & Donald Phillips & Natasha Nadler, 2003. "Running for the 7:45: The effects of public transit improvements on commuter stress," Transportation, Springer, vol. 30(2), pages 203-220, May.
    Full references (including those not matched with items on IDEAS)

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    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Congestion Toll Research
      by ryan in The bellows on 2009-06-19 19:39:34

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    Cited by:

    1. Martens, Karel & Golub, Aaron & Robinson, Glenn, 2012. "A justice-theoretic approach to the distribution of transportation benefits: Implications for transportation planning practice in the United States," Transportation Research Part A: Policy and Practice, Elsevier, vol. 46(4), pages 684-695.

    More about this item

    Keywords

    Equity; Transportation; Road Pricing; Alternative Financing; Tolls; Congestion Pricing.;

    JEL classification:

    • R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise
    • R42 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government and Private Investment Analysis; Road Maintenance; Transportation Planning
    • R48 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government Pricing and Policy
    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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