Recent success in introducing road pricing, as well as recent polls suggest that road pricing schemes are politically viable if a large majority of drivers benefit. In this paper we analyze the welfare effects of an optimal time-varying toll impose during the morning commute. The toll tends to...

There are constraints on pricing congestible facilities. First, if heterogeneous users are observationally indistinguishable, then congestion charges must be anonymous. Second, the time variation of congestion charges may be constrained. Do these constraints undermine the feasibility of marginal...

This paper examines the properties of stationary-state general equilibrium in a monocentric city with durable housing. On the demand side, identical households choose location, housing quality and quantity (floor area), and other goods. On the supply side, developers choose the structural...

Consider an urban economy with two types of externalities, negative traffic congestion externalities and positive agglomeration externalities deriving from non-market interaction. Suppose that urban travel can be tolled, that non-market interaction cannot be subsidized, and that non-market...

For presentation at CESifo Venice Summer Institute 2001, Workshop on Environmental Economics and the Economics of Congestion: Coping with Externalities, Venice International University, San Servolo, July 18-19,2001.

Arnott and Stiglitz (1993) have argued that, in competitive insurance markets with moral hazard, equilibrium may entail firms offering latent policies--policies that are not bought in equilibrium but are kept in place to deter entry. This paper provides an extended example of such an...

It is well known that, for a congestible facility with a constant long-run average cost, the revenue from the unconstrained optimal toll (set so that each individual faces marginal (social) cost of a use) covers the cost of optimal capacity. This paper investigates under what circumstances the...