Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/85984
Authors: 
Verhoef, Erik T.
Rouwendal, Jan
Year of Publication: 
2003
Series/Report no.: 
Tinbergen Institute Discussion Paper 03-027/3
Abstract: 
This paper explores the interrelations between pricing, capacity choice and financingin transportation networks. It builds on the famous Mohring-Harwitz result on self-financing ofoptimally designed roads under optimal congestion pricing, and specifically investigates itsins and outs in a network environment and under various types of second-best regulation. Thepaper develops a small network model, with endogenous car-ownership, in order to study thesequestions both from an analytical and a numerical viewpoint. It is for instance shown thatapplication of the principle over an entire network may cause user prices to increase morestrongly in initially mildly congested areas compared to heavily congested areas, and that aflat kilometre charge, provided accompanied with optimal capacity policies, may result infirst-best efficiency gains.
Subjects: 
Traffic congestion
Road pricing
Road capacity choice.
JEL: 
R41
R48
D62
Document Type: 
Working Paper

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