Price Elasticity Of Travel Demand: The Case Of The A28 Motorway, A Public-Private Partnership In Portugal

In 2010 the Portuguese Government decided to implement a system of electronic collection of tolls on motorways provided by public-private partnerships and projected and first operated as motorways without cost for users (SCUT). Since October 15, 2010 electronic tolls have been collected in three concessions and since December 8, 2011 electronic tolls have been collected in four other concessions, as well as in a segment of another motorway (A23). The experience of collecting tolls in SCUTs is interesting for the debate in the specialized literature. First, SCUT users may respond in different ways to the imposed collection of tolls compared to planned toll motorways. Second, because SCUTs were not prepared for the installation of toll plazas, vehicles using these motorways in Portugal need an electronic device for automatic payment (transponder). If the vehicles have no transponder, drivers have to pay the tolls in pay-shops or in post offices, incurring in an additional cost because of the time and effort involved. Moreover, less frequent users of SCUTs may have insufficient incentive to install transponders, and therefore they avoid the use of motorways with electronic tolls. In this paper we evaluate to what degree the toll component of price elasticity in travel demand is higher on motorways initially projected and operated as toll-free than on motorways initially projected and operated as toll turnpikes. For this purpose we analyse the case of the A28 motorway (concession Norte Litoral) connecting the cities of Porto and Viana do Castelo in north-west continental Portugal.