IDEAS home Printed from https://ideas.repec.org/a/eee/trapol/v17y2010i3p160-172.html
   My bibliography  Save this article

Willingness to spend and road pricing rates

Author

Listed:
  • Ferrari, Paolo

Abstract

Using a theoretical model of urban transport system the paper examines the influence of distribution of willingness to spend within the urban population on road pricing rates. It shows that the rates that must be imposed in an urban area in order to maintain pollutant concentration and congestion due to traffic within acceptable levels is heavily dependent on the distribution of the urban population's willingness to spend. This fact severely limits the reliability of any method for calculating road pricing rates based on theoretical analysis, so that an experimental approach seems necessary. The paper shows that a relation exists between the toll rate per kilometer of trip and the average traffic congestion, which is typical of each urban area and can be determined experimentally by successively imposing three different rates and measuring the corresponding congestion levels. The relation can then be used to determine the pricing scheme when the purpose of road pricing is to maintain both the congestion and the environmental effects due to urban traffic below acceptable thresholds. An example shows how the model can help policymakers in decision-making processes.

Suggested Citation

  • Ferrari, Paolo, 2010. "Willingness to spend and road pricing rates," Transport Policy, Elsevier, vol. 17(3), pages 160-172, May.
    • Handle: RePEc:eee:trapol:v:17:y:2010:i:3:p:160-172
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0967-070X(10)00014-4
    Download Restriction: Full text for ScienceDirect subscribers only
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Gaudry, Marc J. I. & Jara-Diaz, Sergio R. & Ortuzar, Juan de Dios, 1989. "Value of time sensitivity to model specification," Transportation Research Part B: Methodological, Elsevier, vol. 23(2), pages 151-158, April.
    2. Ferrari, Paolo, 2005. "Road pricing and users' surplus," Transport Policy, Elsevier, vol. 12(6), pages 477-487, November.
    3. David Hensher, 2001. "The valuation of commuter travel time savings for car drivers: evaluating alternative model specifications," Transportation, Springer, vol. 28(2), pages 101-118, May.
    4. Hau, Timothy D., 1992. "Economic fundamentals of road pricing : a diagrammatic analysis," Policy Research Working Paper Series 1070, The World Bank.
    5. Yang, Hai & Bell, Michael G. H., 1997. "Traffic restraint, road pricing and network equilibrium," Transportation Research Part B: Methodological, Elsevier, vol. 31(4), pages 303-314, August.
    6. Bell, Michael G. H., 1995. "Stochastic user equilibrium assignment in networks with queues," Transportation Research Part B: Methodological, Elsevier, vol. 29(2), pages 125-137, April.
    7. Hensher, David A., 0. "The sensitivity of the valuation of travel time savings to the specification of unobserved effects," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 37(2-3), pages 129-142, April.
    8. Hess, Stephane & Bierlaire, Michel & Polak, John W., 2005. "Estimation of value of travel-time savings using mixed logit models," Transportation Research Part A: Policy and Practice, Elsevier, vol. 39(2-3), pages 221-236.
    9. Ferrari, Paolo, 1997. "Capacity constraints in urban transport networks," Transportation Research Part B: Methodological, Elsevier, vol. 31(4), pages 291-301, August.
    10. Mackie, Peter, 2005. "The London congestion charge: A tentative economic appraisal. A comment on the paper by Prud'homme and Bocajero," Transport Policy, Elsevier, vol. 12(3), pages 288-290, May.
    11. Yang, Hai & Meng, Qiang & Lee, Der-Horng, 2004. "Trial-and-error implementation of marginal-cost pricing on networks in the absence of demand functions," Transportation Research Part B: Methodological, Elsevier, vol. 38(6), pages 477-493, July.
    12. G. F. Newell, 1979. "Some Issues Relating to the Optimal Design of Bus Routes," Transportation Science, INFORMS, vol. 13(1), pages 20-35, February.
    13. Yang, Hai & Huang, Hai-Jun, 1998. "Principle of marginal-cost pricing: how does it work in a general road network?," Transportation Research Part A: Policy and Practice, Elsevier, vol. 32(1), pages 45-54, January.
    14. Ferrari, Paolo, 1995. "Road pricing and network equilibrium," Transportation Research Part B: Methodological, Elsevier, vol. 29(5), pages 357-372, October.
    15. David Hensher & William Greene, 2003. "The Mixed Logit model: The state of practice," Transportation, Springer, vol. 30(2), pages 133-176, May.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Agarwal, Sumit & Koo, Kang Mo, 2016. "Impact of electronic road pricing (ERP) changes on transport modal choice," Regional Science and Urban Economics, Elsevier, vol. 60(C), pages 1-11.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ferrari, Paolo, 2005. "Road pricing and users' surplus," Transport Policy, Elsevier, vol. 12(6), pages 477-487, November.
    2. Hai Yang, 1999. "Evaluating the benefits of a combined route guidance and road pricing system in a traffic network with recurrent congestion," Transportation, Springer, vol. 26(3), pages 299-322, August.
    3. Ferrari, Paolo, 2002. "Road network toll pricing and social welfare," Transportation Research Part B: Methodological, Elsevier, vol. 36(5), pages 471-483, June.
    4. Francisco Javier Amador Morera & Rosa Marina González Marrero, 2005. "Value of Travel Time Savings for University Students and Preference Heterogeneity," Hacienda Pública Española / Review of Public Economics, IEF, vol. 174(3), pages 25-41, September.
    5. Yang, Hai & Huang, Hai-Jun, 2004. "The multi-class, multi-criteria traffic network equilibrium and systems optimum problem," Transportation Research Part B: Methodological, Elsevier, vol. 38(1), pages 1-15, January.
    6. Seungkyu Ryu & Anthony Chen & Xiangdong Xu & Keechoo Choi, 2014. "A Dual Approach for Solving the Combined Distribution and Assignment Problem with Link Capacity Constraints," Networks and Spatial Economics, Springer, vol. 14(2), pages 245-270, June.
    7. Basu, Debasis & Hunt, John Douglas, 2012. "Valuing of attributes influencing the attractiveness of suburban train service in Mumbai city: A stated preference approach," Transportation Research Part A: Policy and Practice, Elsevier, vol. 46(9), pages 1465-1476.
    8. Xin Lin & Chris M. J. Tampère & Stef Proost, 2020. "Optimizing Traffic System Performance with Environmental Constraints: Tolls and/or Additional Delays," Networks and Spatial Economics, Springer, vol. 20(1), pages 137-177, March.
    9. Yang, Hai & Meng, Qiang, 1998. "Departure time, route choice and congestion toll in a queuing network with elastic demand," Transportation Research Part B: Methodological, Elsevier, vol. 32(4), pages 247-260, May.
    10. Seungkyu Ryu, 2021. "Mode Choice Change under Environmental Constraints in the Combined Modal Split and Traffic Assignment Model," Sustainability, MDPI, vol. 13(7), pages 1-16, March.
    11. Saxena, N. & Rashidi, T.H. & Dixit, V.V. & Waller, S.T., 2019. "Modelling the route choice behaviour under stop-&-go traffic for different car driver segments," Transportation Research Part A: Policy and Practice, Elsevier, vol. 119(C), pages 62-72.
    12. Hess, Stephane & Bierlaire, Michel & Polak, John W., 2005. "Estimation of value of travel-time savings using mixed logit models," Transportation Research Part A: Policy and Practice, Elsevier, vol. 39(2-3), pages 221-236.
    13. Yang, Hai & Zhang, Xiaoning & Meng, Qiang, 2004. "Modeling private highways in networks with entry-exit based toll charges," Transportation Research Part B: Methodological, Elsevier, vol. 38(3), pages 191-213, March.
    14. Yildirim, Mehmet Bayram & Hearn, Donald W., 2005. "A first best toll pricing framework for variable demand traffic assignment problems," Transportation Research Part B: Methodological, Elsevier, vol. 39(8), pages 659-678, September.
    15. Fosgerau, Mogens, 2006. "Investigating the distribution of the value of travel time savings," Transportation Research Part B: Methodological, Elsevier, vol. 40(8), pages 688-707, September.
    16. Zhou, Bojian & Bliemer, Michiel & Yang, Hai & He, Jie, 2015. "A trial-and-error congestion pricing scheme for networks with elastic demand and link capacity constraints," Transportation Research Part B: Methodological, Elsevier, vol. 72(C), pages 77-92.
    17. Jan-Erik Swärdh & Staffan Algers, 2016. "Willingness to accept commuting time within the household: stated preference evidence," Transportation, Springer, vol. 43(2), pages 219-241, March.
    18. Qiang Meng & Zhiyuan Liu, 2011. "Trial-and-error method for congestion pricing scheme under side-constrained probit-based stochastic user equilibrium conditions," Transportation, Springer, vol. 38(5), pages 819-843, September.
    19. Fosgerau, Mogens & Bierlaire, Michel, 2007. "A practical test for the choice of mixing distribution in discrete choice models," Transportation Research Part B: Methodological, Elsevier, vol. 41(7), pages 784-794, August.
    20. Martínez-Pardo, Ana & Orro, Alfonso & Garcia-Alonso, Lorena, 2020. "Analysis of port choice: A methodological proposal adjusted with public data," Transportation Research Part A: Policy and Practice, Elsevier, vol. 136(C), pages 178-193.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:trapol:v:17:y:2010:i:3:p:160-172. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/30473/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.