Economic efficiency of second-best congestion pricing schemes in urban highway systems
This paper examines urban highway congestion pricing in the instance in which it is not possible to levy a congestion toll on a major portion of the urban road system. This case is pertinent because of technical and/or political constraints. The paper uses economic theory of the second best and a simulation model to compare first-best, second-best and no-toll solutions for a model with two routes and two time periods (peak and pre-peak). The main findings from the simulation results are: (1) the second-best scheme is effective but less efficient than the first-best scheme in reallocating traffic volumes; (2) the second-best tolls are appreciably smaller than the first-best tolls; (3) the welfare gains from the second-best policy are much smaller than the welfare gains that are possible with a complete set of first-best tolls. It is also shown that the nature of the simulation results is not sensitive to reasonable cost and demand parameters.
Year of publication: |
1999
|
---|---|
Authors: | Liu, Louie Nan ; McDonald, John F. |
Published in: |
Transportation Research Part B: Methodological. - Elsevier, ISSN 0191-2615. - Vol. 33.1999, 3, p. 157-188
|
Publisher: |
Elsevier |
Saved in:
Online Resource
Saved in favorites
Similar items by person
-
Liu, Louie Nan, (1998)
-
Economics of urban highway congestion and pricing
McDonald, John F., (1999)
-
Liu, Louie Nan, (1998)
- More ...