PRICING THE USE OF THE ROADS-A MATHEMATICAL AND NUMERICAL STUDY

ECONOMISTS HAVE POINTED OUT THAT ROADS WOULD BE MORE EFFICIENTLY UTILIZED IN CONGESTED AREAS IF ROAD USERS WERE REQUIRED TO PAY THE COST OF THE EXTRA CONGESTION THAT THEIR PRESENCE IMPOSES ON OTHER ROAD USERS. THIS PAPER PRESENTS A MATHEMATICAL ANALYSIS OF THE QUESTION. FORMULAE ARE FOUND FOR THE NET BENEFIT PROVIDED BY A LENGTH OF ROAD AND FOR THE OPTIMUM CHARGE WHICH IS NECESSARY TO MAXIMIZE THIS BENEFIT. IN GREAT BRITAIN ON A ROAD WHERE THE PRESENT SPEED IS 10 MILE/H, THE OPTIMUM CHARGE IS ABOUT 14 PENCE PER VEHICLE- MILE IF LEISURE TIME IS VALUED AT THE SAME RATE AS WORKING TIME. FOR A SPEED OF 15 MILE/H IT IS 6 PENCE AND FOR 20 MILE /H IT IS 2 1/2 PENCE. THESE VALUES ARE NOT VERY SENSITIVE TO THE ASSUMED ELASTICITY OF DEMAND, TO THE SPEED FLOW RELATION OR TO THE OPERATING COST PER MILE. THE POTENTIAL BENEFITS FROM AN OPTIMUM CHARGING POLICY ARE LARGELY CONFINED TO HIGHLY CONGESTED ROADS. ESTIMATES ARE MADE OF THE TOTAL BENEFIT THAT COULD BE OBTAINED IN GREAT BRITAIN BY ADOPTING AN OPTIMUM CHARGING POLICY. FOR 1961 CONDITIONS, THE ESTIMATE IS 109 MILLION BRITISH POUNDS PER YEAR IF LEISURE TIME IS VALUED AT THE SAME RATE AS WORKING TIME.

  • Supplemental Notes:
    • pp 317-345, 10FIG, 8TAB, 12REF
  • Corporate Authors:

    Organisation for Economic Co-operation and Development (OECD)

    2, rue André Pascal
    Paris,   France  75775 Paris Cedex 16
  • Authors:
    • TANNER, J C
  • Publication Date: 1965

Subject/Index Terms

Filing Info

  • Accession Number: 00201260
  • Record Type: Publication
  • Source Agency: Road Research Laboratory /UK
  • Files: TRIS
  • Created Date: Jun 15 1994 12:00AM