Issues of economic efficiency, equity, external costs, and political feasibility as they can help determine the distribution of road pricing revenue are examined. Economic efficiency requires only that revenue be used to benefit society and that it not be refunded to users in proportion to how much they have paid. Efficiency does not require that revenue be dedicated to transportation programs. Horizontal equity implies that revenues should be returned to vehicle users as a class but only after external costs are compensated. Because most estimates of motor vehicle external costs are larger than the expected revenue of road-pricing proposals, the horizontal equity justification for returning revenues to drivers is reduced or eliminated. Vertical equity requires that revenues benefit low-income drivers as a class at least as much as the costs they bear and that disadvantaged residents (including nondrivers) benefit overall. Current conventional thinking is that revenues must be dedicated to transportation improvements to be politically feasible, but some analyses indicate that alternative distributions that include broad tax reductions or financial rebates benefit the largest number of citizens and therefore may be more politically popular.


    Access

    Download

    Check availability in my library

    Order at Subito €


    Export, share and cite



    Title :

    Using Road Pricing Revenue: Economic Efficiency and Equity Considerations


    Additional title:

    Transportation Research Record


    Contributors:


    Publication date :

    1996-01-01




    Type of media :

    Article (Journal)


    Type of material :

    Electronic Resource


    Language :

    English




    Using Road Pricing Revenue: Economic Efficiency and Equity Considerations

    Litman, Todd | Transportation Research Record | 1996



    Dynamic Road Pricing for Revenue Maximization

    Hassan, Ahmed / Abdelghany, Khaled / Semple, John | Transportation Research Record | 2013


    Pricing road use: politico-economic and fairness considerations

    Oberholzer-Gee, Felix | Online Contents | 2002