Abstract

A ban restricting each car from driving on a specified weekday is found to have increased total driving in Mexico City. Because of the ban, cars effectively represent "driving permits," and some households have bought an additional car and increased their driving. Greater use of old cars, congestion effects, and increased weekend driving may also have contributed to the disappointing results. The ban has high welfare costs and does not deliver the intended benefits of reduced driving—quite the contrary. The experience provides an interesting lesson in applied welfare economics. Theory indicates that this is a costly way of reducing traffic and pollution. But the finding that the strategy is counterproductive could be made only with applied quantitative analysis. In November 1989 the Mexico City administration imposed a regulation banning each car from driving a specific day of the week. Called Hoy no circula (this one does not circulate today), the "Day without a Car" regulation specifies that cars with license plate numbers ending with digits 0 or 1 do not drive on Monday, 2 or 3 do not drive on Tuesday, and so on. Restrictions do not apply on weekends. The regulation applies to all cars (except those of the fire department) and thus to firms as well as households. We use the term household for simplicity. Compliance is generally believed to be high: the police are visible and fines are heavy. The regulation has been both popular and controversial. Some people argue that it places a reasonable burden on car owners in order to alleviate congestion and pollution problems. Others argue that it is inefficient and unfair: inefficient in the way most rationing devices are inefficient; unfair because it is more easily avoided or accommodated by some than by others. Finally, some people are arguing that the regulation is counterproductive, actually increasing the levels of congestion and pollution because many households have purchased additional cars to circumvent the ban. This article analyzes the policy pragmatically. Section I shows how the results of rationing can be compared with those that would be obtained using marke Document type: Book

Abstract

The Mexico City Metropolitan Area has been suffering severely from transportation externalities such as accidents, air pollution, and traffic congestion. This study examines pricing instruments to reduce these externalities using an analytical and numerical model. The study shows that the optimal levels of a gasoline tax and a congestion toll on automobiles could generate social benefits, measured in terms of welfare gain, of US$132 and US$109 per capita, respectively, through the reduction of externalities. The largest component of the welfare gains comes from reduced congestion, followed by local air pollution reduction. The optimal toll and tax would, however, double the cost of driving and could be politically sensitive. Still, more than half of those welfare gains could be obtained through a more modest tax or toll, equivalent to $1 per gallon of gasoline. The welfare gains from reforming the pricing of public transportation are small relative to those from reforming the taxation of automobiles. Although the choice among travel modes depends on specific circumstances, in the absence of road travel pricing that accounts for externalities, there will be potential for higher investment in roads relative to mass transit. Given the rapidly increasing demand for transportation infrastructure in Mexico City, careful efforts should be made to include the full social costs of travel in evaluating alternative infrastructure investments. Document type: Book

Abstract

In order to provide better Quality-of-Service (QoS) in large networks, several congestion pricing proposals have been made in the last decade. Usually, however, those proposals studied optimal strategies and did not focus on implementation issues. Our main contribution in this paper is to address implementation issues for congestion-sensitive pricing over a single domain of the differentiated-services (diff-serv) architecture of the Internet. We propose a new congestion-sensitive pricing framework Distributed Dynamic Capacity Contracting (Distributed-DCC), which is able to provide a range of fairness (e.g. max-min, proportional) in rate allocation by using pricing as a tool. Within the Distributed-DCC framework, we develop an Edge-to-Edge Pricing Scheme (EEP) and present simulation experiments of it. Document type: Part of book or chapter of book

Abstract

Air transport delays have increased during the past decade both in Europe and US. The main reasons have been continuously growing air transport demand, constrained capacity of the system infrastructure, and disruption of services caused by bad weather, failures of the infrastructure components, facilities and equipment, and industrial action of the aviation staff. Growing demand combined with constrained infrastructure capacity and frequently disrupted by a bad weather have been identified as the most frequent causes of congestion and delays at large airports. Potential remedies have shown to be improvement of utilisation of the existing infrastructure capacity by introducing technological and operational innovations, physical expansion of this capacity, and management of access to the scarce infrastructure capacity. The first option has shown to have the very limited effect. In many cases, the second option has been impossible to be implemented due to the various political and environmental constraints in terms of land take in both the airport airside and landside area. The solution of management of access to the existing scarce infrastructure capacity (i.e., ?demand management) has recently been considered as an additional viable option to relief the congestion problem. This paper deals with modelling of management of access to a congested airport by using congestion charging. The complexity of setting up a relevant congestion charge (toll) based on the system delays imposed by an additional aircraft on itself and on the others during peak-periods has been particularly elaborated. For such a purpose, queuing model of a congested airport, as an essential tool for estimating the aircraft delays, particularly in cases of changes of the airport capacity caused by disruptions, is developed. The existing theory of congestion pricing is upgraded by an explicit introduction of the differences between particular customers - the aircraft - requesting service during peaks in terms of the arrival time, type (seat capacity, operational cost), type of flight (short, medium, long-haul), and actual number of passengers on board. These all are also the most important factors expected to influence a tool, which, if consequently applied, is expected to change in line with changes of these factors. This also illustrates controversy and complexity of implementing such tool, the process, which is under consideration (i.e., in a rudimentary phase) at some airports in the U.S. and Europe. KEY WORDS: air transport, airport, queuing theory, congestion pricing Document type: Part of book or chapter of book

Abstract

The main focus of this report is on the initial period of the World Bank’s engagement with transport in cities (1972-82). This study looks at the project practice in light of the strategy document, Urban Transport Sector paper which was published in 1975 to guide the Bank’s lending program. The strategy focused on the relation between poverty and transport, recommending a spatially-extensive, low-cost, and price-based response to access and traffic problems; improvements in provision of public transport services; and coordination between land use and transport planning. The report presents a thorough analysis of the Bank’s strategy and practice in the urban transport sector as well as overview of lessons learned, including from projects that did not achieve their planned objectives. Overall, these pioneering efforts in both strategy and practice were well conceived and executed and played a catalytic role in most client cities. Document type: Book

Abstract

Using a nested multinomial logit model of car ownership and personal travel in Beijing circa 2005, this paper compares the effectiveness of different policy instruments to reduce traffic congestion and CO2 emissions. The study shows that a congestion toll is more efficient than a fuel tax in reducing traffic congestion, whereas a fuel tax is more effective as a policy instrument for reducing gasoline consumption and emissions. An improvement in car efficiency would also reduce congestion, fuel consumption, and CO2 emissions significantly; however, this policy benefits only richer households that own a car. Low-income households do better under the fuel tax policy than under the efficiency improvement and congestion toll policies. The congestion toll and fuel tax require the travel cost per mile to more than triple. The responsiveness of aggregate fuel and CO2 are, approximately, a 1 percent drop for each 10 percent rise in the money cost of a car trip. Document type: Book

Abstract

This study examines impacts on net social benefits or economic welfare of alternative policy instruments for reducing traffic congestion and atmospheric emissions in São Paulo, Brazil. The study shows that expanding road networks, subsidizing public transit, and improving automobile fuel economy may not be as effective as suggested by economic theories because these policies could cause significant rebound effects. Although pricing instruments such as congestion tolls and fuel taxes would certainly reduce congestion and emissions, the optimal level of these instruments would steeply increase the monetary cost of travel per trip and are therefore politically difficult to implement. However, a noticeable finding is that even smaller tolls, which are more likely to be politically acceptable, have substantial benefits in terms of reducing congestion and emissions. Among the various policy instruments examined in the study, the most socially preferable policy option for São Paulo would be to introduce a mix of congestion toll and fuel taxes on automobiles and use the revenues to improve public transit systems. Document type: Book

Abstract

Economically efficient prices for the passenger transportation system in the Greater Cairo Metropolitan Area would account for broader societal costs of traffic congestion and accidents, and local and global pollution. A $2.20 per gallon gasoline tax (2006 US$) would be economically efficient, compared with the current subsidy of $1.20 per gallon. Removal of the existing subsidy alone would achieve about three-quarters of the net benefits from subsidy elimination and the tax. Per-mile tolls could target congestion and accident externalities more efficiently than fuel taxes, although they are not practical at present. A combination of $0.80 per gallon gasoline tax to address pollution (versus $2.20 without tolls), and $0.12 and $0.19 tolls per vehicle mile on automobiles and microbuses, respectively, to address traffic congestion and accident externalities (versus $0.22 without fuel taxes) would be most efficient. Current public bus and rail subsidies are relatively close to efficient levels in the absence of such policies; however, if automobile and microbus externalities were fully addressed through more efficient pricing, optimal subsides to public transit would be smaller than current levels. Document type: Book

Abstract

This paper considers a congested bottleneck. A fast lane reserves a more than proportional share of capacity to a designated group of travellers. Travellers are otherwise identical and other travellers can use the reserved capacity when it would otherwise be idle. The paper shows that such a fast lane is always Pareto improving under Nash equilibrium in arrival times at the bottleneck and inelastic demand. It can replicate the arrival schedule and queueing outcomes of a toll that optimally charges a constant toll during part of the demand peak. Within some bounds, the fast lane scheme is still welfare improving when demand is elastic. Document type: Book

Abstract

This paper describes the modeling of recurring congestion in a network. It is shown that the standard economic models of marginal cost cannot describe precisely traffic congestion in networks during time-dependent conditions. Following a macroscopic traffic approach, we describe the equilibrium solution for a congested network in the no-toll case. A dynamic model of cordon-based congestion pricing (such as for the morning commute) for networks is developed consistent with the physics of traffic.Ê The paper combines VickreyÕs theory with a macroscopic traffic model, which is readily observable with existing monitoring technologies. The paper also examines some policy implications of the cordon-based pricing to treat equity and reliability issues, i.e. in what mobility level a city should choose to operate. An application of the model in a downtown area shows that these schemes can improve mobility and relieve congestion in cities. Document type: Part of book or chapter of book