Will Congestion Pricing of Highways Finally Happen?

Lynne Kiesling

This NY Times article from Daniel Gross is very exciting! Highway congestion pricing becoming a reality … pinch me, am I dreaming?

Advances in technology and the successful experiments in Europe and the United States lead many economists to view the present as an ideal time to apply the theory to traffic control. Since February 2003, when London introduced a system that charged a fee to motorists entering the central city on weekdays, “congestion has been reduced noticeably,” said Edward L. Glaeser, professor of economics at Harvard. “People are using the roads less, and there have been remarkable upticks in speeds.”

Beyond that, congestion pricing holds out the possibility of harnessing people’s innate economic rationality and self-interest in order to promote a series of public goods. Every time a driver turns onto the Henry Hudson Parkway, she slows down the travel speed of all the other drivers, imposing a cost — or, as economists say, a negative externality — on countless fellow citizens. “Everybody wants fewer people to drive, and everybody wants people to use less gas,” said Gregory L. Rosston, deputy director of the Stanford Institute for Economic Policy Research in Palo Alto, Calif.

But my favorite part is at the end, where Ed Glaeser debunks the idea that congestion pricing harms the poor:

The notion of charging people for a good or service generally regarded as free — driving on highways — also instills political opposition. In New York, many elected officials argued that charging fees to drivers would be a burden for poor and middle-income people.

Professor Glaeser disagrees.

“The greatest beneficiaries of reduced congestion on roads in New York would be people who ride buses to get to and from work, who would find their commutes shortened.”

One thought on “Will Congestion Pricing of Highways Finally Happen?

  1. Ooooooooooh, February 2003!

    Singapore has been doing this for its 4 million residents since 1998. Over there it’s called “Electronic Road Pricing”, or ERP.

    NYT editors are probably being called out on this rather gross omission, as we speak.

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