Pricing transport networks with fixed residential location

For a congestible static traffic network which is used by different households, the conditions for optimal link tolls and destination charges are analysed for the case where not all links or destinations in the network can be tolled (partial network pricing). It is shown that differences in transpor...

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Bibliographic Details
Published in:Regional science and urban economics 2004-05, Vol.34 (3), p.289-307
Main Author: Van Dender, Kurt
Format: Article
Language:English
Subjects:
Congestion
Economic theory
Households
Networks
Pricing
Pricing policies
Regional studies
Road transport
Social costs
Studies
Traffic
Transportation economics
Urban studies
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Summary:For a congestible static traffic network which is used by different households, the conditions for optimal link tolls and destination charges are analysed for the case where not all links or destinations in the network can be tolled (partial network pricing). It is shown that differences in transport costs across households lead to unequal treatment of equal households at the social welfare optimum. Constraints on network pricing imply complex deviations from marginal social cost pricing because of network interactions. Parking charges rival second-best link tolls under some conditions. When no differentiated lump sum transfers are available, the optimal link tolls will deviate from marginal external congestion costs, even in the absence of network pricing constraints. Stylised examples are used to illustrate the interactions.
ISSN:0166-0462
1879-2308
DOI:10.1016/S0166-0462(03)00057-7