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Congestion Pricing: Long-Term Economic and Land-Use Effects

Author

Listed:
  • Safirova, Elena A.

    () (Resources for the Future)

  • Houde, Sébastien

    () (Resources for the Future)

  • Lipman, D. Abram
  • Harrington, Winston

    () (Resources for the Future)

  • Bagliano, Andrew D.

Abstract

We employ a spatially disaggregated general equilibrium model of a regional economy that incorporates decisions of residents, firms, and developers integrated with a spatially disaggregated strategic transportation planning (START) model that features mode, time period, and route choice to evaluate economic effects of congestion pricing. First, we evaluate the long-run effects of a road-pricing policy based on the integrated model of land use, strategic transport, and regional economy (LUSTRE) and compare them with the short-term effects obtained from the START model alone. We then look at distributional effects of the policy in question and point out differences and similarities in the short run versus the long run. Finally, we analyze the mechanisms at the source of the economic and land-use effects induced by the road-pricing policy.

Suggested Citation

  • Safirova, Elena A. & Houde, Sébastien & Lipman, D. Abram & Harrington, Winston & Bagliano, Andrew D., 2006. "Congestion Pricing: Long-Term Economic and Land-Use Effects," Discussion Papers dp-06-37, Resources For the Future.
  • Handle: RePEc:rff:dpaper:dp-06-37
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    References listed on IDEAS

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    1. Verhoef, Erik T., 2005. "Second-best congestion pricing schemes in the monocentric city," Journal of Urban Economics, Elsevier, vol. 58(3), pages 367-388, November.
    2. Mun, Se-il & Konishi, Ko-ji & Yoshikawa, Kazuhiro, 2005. "Optimal cordon pricing in a non-monocentric city," Transportation Research Part A: Policy and Practice, Elsevier, vol. 39(7-9), pages 723-736.
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    6. Prud'homme, Rémy & Bocarejo, Juan Pablo, 2005. "The London congestion charge: a tentative economic appraisal," Transport Policy, Elsevier, vol. 12(3), pages 279-287, May.
    7. Safirova, Elena & Gillingham, Kenneth & Houde, Sébastien, 2007. "Measuring marginal congestion costs of urban transportation: Do networks matter?," Transportation Research Part A: Policy and Practice, Elsevier, vol. 41(8), pages 734-749, October.
    8. Nelson, Peter & Baglino, Andrew & Harrington, Winston & Safirova, Elena & Lipman, Abram, 2007. "Transit in Washington, DC: Current benefits and optimal level of provision," Journal of Urban Economics, Elsevier, vol. 62(2), pages 231-251, September.
    9. Safirova, Elena & Gillingham, Kenneth & Parry, Ian & Nelson, Peter & Harrington, Winston & Mason, David, 2004. "8. Welfare And Distributional Effects Of Road Pricing Schemes For Metropolitan Washington Dc," Research in Transportation Economics, Elsevier, vol. 9(1), pages 179-206, January.
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    15. Jonas Eliasson & Lars-Göran Mattsson, 2001. "Transport and Location Effects of Road Pricing: A Simulation Approach," Journal of Transport Economics and Policy, University of Bath, vol. 35(3), pages 417-456, September.
    16. Mun, Se-il & Konishi, Ko-ji & Yoshikawa, Kazuhiro, 2003. "Optimal cordon pricing," Journal of Urban Economics, Elsevier, vol. 54(1), pages 21-38, July.
    17. Parry, I. W. H., 2002. "Comparing the efficiency of alternative policies for reducing traffic congestion," Journal of Public Economics, Elsevier, vol. 85(3), pages 333-362, September.
    18. Akiyama Takamasa & Mun Se-Il & Okushima Masashi, 2004. "Second-Best Congestion Pricing in Urban Space: Cordon Pricing and Its Alternatives," Review of Network Economics, De Gruyter, vol. 3(4), pages 1-14, December.
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    Citations

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    Cited by:

    1. Safirova, Elena & Gillingham, Kenneth & Houde, Sébastien, 2007. "Measuring marginal congestion costs of urban transportation: Do networks matter?," Transportation Research Part A: Policy and Practice, Elsevier, vol. 41(8), pages 734-749, October.
    2. Magliocca, Nicholas & McConnell, Virginia & Walls, Margaret, 2015. "Exploring sprawl: Results from an economic agent-based model of land and housing markets," Ecological Economics, Elsevier, vol. 113(C), pages 114-125.
    3. Magliocca, Nicholas & McConnell, Virginia & Walls, Margaret & Safirova, Elena, 2012. "Zoning on the urban fringe: Results from a new approach to modeling land and housing markets," Regional Science and Urban Economics, Elsevier, vol. 42(1-2), pages 198-210.
    4. Safirova, Elena A. & Houde, Sébastien & Harrington, Winston, 2007. "Spatial Development and Energy Consumption," Discussion Papers dp-07-51, Resources For the Future.
    5. Catherine Althaus & Lindsay M. Tedds & Allen McAvoy, 2011. "The Feasibility of Implementing a Congestion Charge on the Halifax Peninsula: Filling the "Missing Link" of Implementation," Canadian Public Policy, University of Toronto Press, vol. 37(4), pages 541-561, December.
    6. Safirova, Elena A. & Houde, Sébastien & Harrington, Winston, 2008. "Marginal Social Cost Pricing on a Transportation Network: Comparison of Second-Best Policies," Discussion Papers dp-07-52, Resources For the Future.
    7. Mahyar Amirgholy & Hojjat Rezaeestakhruie & Hossain Poorzahedy, 2015. "Multi-objective cordon price design to control long run adverse traffic effects in large urban areas," Netnomics, Springer, vol. 16(1), pages 1-52, August.
    8. Safirova, Elena A. & Houde, Sébastien & Coleman, Conrad T. & Harrington, Winston & Lipman, D. Abram, 2006. "Long-Term Consequences of Congestion Pricing: A Small Cordon in the Hand Is Worth Two in the Bush," Discussion Papers dp-06-42, Resources For the Future.
    9. Houde, Sébastien & Safirova, Elena A. & Harrington, Winston, 2007. "Washington START Transportation Model," Discussion Papers dp-07-43, Resources For the Future.
    10. André de Palma & Jean-Luc Prigent, 2007. "Hedging global environment risks: An option based portfolio insurance," THEMA Working Papers 2007-09, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.

    More about this item

    Keywords

    traffic congestion; welfare analysis; CGE modeling; cordon tolls; distributional effects;

    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • R13 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General Equilibrium and Welfare Economic Analysis of Regional Economies
    • R14 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Land Use Patterns
    • R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise

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