We examine carpooling and driver responses to fuel price changes. Using a simple theoretical model, we show that traffic flows in mainline lanes unambiguously decrease when fuel prices increase, and this effect is stronger when the presence of a carpool lane provides a substitute to driving...

First-best pricing or assignment of property rights for rival and non-excludable goods is often infeasible. In a second-best setting where the social planner cannot limit total use, we show common-property resources can be over or under-consumed. This depends on whether the external benefits of...

In transportation systems with unpriced congestion, allowing single-occupant low-emission vehicles in high-occupancy vehicle (HOV) lanes to encourage their adoption exacerbates congestion costs for carpoolers. The resulting welfare effects of the policy are negative, with environmental benefits...

This paper examines the welfare effects of anti-sprawl policies, such as development tax, in a simple spatial explicit urban model with two market failures - urban decline at the city core and underprovision of open space amenities at the urban fringe - and pre-existing distortionary property...

Understanding how drivers respond to fuel price changes has important implications for highway congestion, accidents, carbon policy, local air pollution and taxation. We examine the underexplored relationship between fuel prices and carpooling. Using a simple theoretical model we show that...