Abstract
During the last decade much progress has been made in defining & measuring the external costs of transport. As the cost of tolling equipment falls, the set of realistic policy options to internalise these externalities will continue to grow. This will determine the research and policy agenda. We make three points. Firstly, empirical work is still necessary to better identify marginal external costs, including congestion, accident and environmental costs. Secondly, any assessment of policy options should treat externalities simultaneously. The use of pricing instruments and emissions standards are discussed within this framework. Thirdly, we emphasise the role of government. Designing the optimal road-pricing institutions requires consideration of horizontal and vertical tax competition, while double-dividend arguments are central to the question of securing public support.
Similar content being viewed by others
References
ApSimon, H., D. W. Pearce and E. Ozdemiroglu (1997), Acid Rain in Europe. London: Earthscan.
Arnott, R., A. de Palma and R. Lindsey (1993), ‘A Structural Model of Peak-Period Congestion: A Traffic Bottleneck with Elastic Demand’, American Economic Review 83(1), 161–179.
Arnott, R. and J. Rowse (1995), Modeling Parking. Department of Economics, Boston College.
Baumol, W., W. Oates (1988), The Theory of Environmental Policy. Cambridge: Cambridge University Press.
Courcelle, C., B. de Borger and D. Swyssen (1997), ‘Optimising Pricing of Transport Externalities in a Federal System’, paper presented at Meeting of International Institute of Public Finance.
De Borger, B., S. Ochelen, S. Proost and D. Swyssen (1997), ‘Alternative Transport Pricing and Regulation Policies: A Welfare Analysis for Belgium in 2005’, Transportation Research D 2(3), 177–198.
Degraeve, Z., G. Koopman C, Denis and L. Teunen (1998), ‘Deriving and Selecting Policy Instruments to Meet Air Quality Standards in the European Union’, in S. Proost and J. Baden, eds., Climate Change, Transport and Environmental Policy – Empirical Applications in a Federal System. Cheltenham, UK: Edward Elgar.
ETSU and IER (1994),Coal Fuel Cycle, Estimation of Physical Impacts and Monetary Valuation for Priority Impact Pathways. Brussels: European Commission DGXII.
Greene, D., D. Jones and M. E. Delucchi (1997), The Full Costs and Benefits of Transportation: Contributions to Theory, Method and Measurement. Springer.
Harrington, W., V. mcConnell and A. Alberini (1996), Economic Incentive Policies under Uncertainty: The Case of Vehicle Emission Fees. Washington DC: Resources for the Future.
Hensher, D. (1997), ‘Behavioral Value of Travel Time Savings in Personal and Commercial Automobile Travel’, in D. Greene, D. Jones and M. Delucchi, eds., The Full Costs and Benefits of Transportation: Contributions to Theory, Method and Measurement. Springer.
Jansson, J. O. (1994), ‘Accident Externality Charges’, Journal of Transport Economics and Policy, XXVIII, 31–43.
Johannesson, M. and P.-O. Johansson (1997), ‘Quality of Life and the WTP for an Increased Life Expectancy at an Advanced Age’, Journal of Public Economics 65, 219–228.
Johansson, O. (1997), ‘Optimal Road Pricing: Simultaneous Treatment of Time Losses, Increased Fuel Consumption, and Emissions’, Transportation Research D 2(2), 77–87.
Johansson, O. (1997), ‘Optimal Road Pricing with Respect to Accidents in a Second-Best Perspective’, International Journal of Transport Economics XXIV(3), 343–365.
Johansson, O. and L. Schipper (1997), ‘Measuring the Long-Run Fuel Demand of Cars’, Journal of Transport Economics and Policy, 277–292.
Johansson, P.-O. (1995), Evaluating Health Risks. Cambridge: Cambridge University Press.
Jones-Lee, M. W. (1990), ‘The Value of Transport Safety’, Oxford Review of Economic Policy 6, 39–60.
Jones-Lee, M. W., G. Loomes and A. Robinson (1995), ‘Why Did Two Theoretically Equivalent Methods Produce Two Very Different Values?’, in N. Schwab Christe and N. Soguel, eds., Contingent Valuation, Transport Safety and the Value of Life. Dordrecht: Kluwer Academic Publishers, pp. 111–136.
Kazimi, C. (1997), ‘Valuing Alternative-fuel Vehicles in Southern California’, American Economic Review, AEA papers and proceedings, 265–271.
Keeler, T. E. and K. A. Small (1977), ‘Optimal Peak-Load Pricing, Investment, and Service Levels on Urban Expressways’, Journal of Political Economy 85, 1–25.
Lee, N. and M. Q. Dalvi (1969), ‘Variations in the Value of Travel Time’, Journal of Manchester School of Economics and Social Studies 37, 213–236.
Lindsey, R. (1996), ‘Optimal Departure Scheduling for the Morning Rush Hour when Capacity is Uncertain’, in 7th WCTR Proceedings, pp. 195–211.
Maddison, D., D. Pearce, O. Johansson, E. Calthrop, T. Litman and E. Verhoef (1996), The True Costs of Road Transport. CSERGE, London: Earthscan.
Mayeres, I., S. Ochelen and S. Proost (1996), ‘The Marginal External Costs of Urban Transport’, Transportation Research D 1(2), 111–130.
Mayeres, I. and S. Proost (1997), ‘Optimal Tax and Public Investment Rules for Congestion Type of Externalities’, Scandinavian Journal of Economics 99(2), 261–279.
Mcconnell, V., M. Walls and W. Harrington (1995), Evaluating the Costs of Compliance with Mobile Source Emission Control Rquirements: Retrospective Analysis. Washington DC: RFF.
Newbery, D. (1990), ‘Pricing and Congestion: Economic Principles Relevant to Pricing Roads’, Oxford Review of Economic Policy 6, 22–38.
Newbery, D. (1988), ‘Road Damage Externalities and Road User Charges’, Econometrica 56, 295–316.
Oates, W. E., P. R. Portney and A. M. Mcgartland (1989), ‘The Net Benefits of Incentive-Based Regulation: A Case Study of Environmental Standard Setting’, American Economic Review 79(5), 1233–1242.
Ochelen, S. and S. Proost (June 1996), ‘Internalisation of Externalities by a Local Government’, paper presented at European Association of Environmental Economics.
Persson, U. and K. Adegaard (1995), ‘External Cost Estimates of Road Traffic Accidents. An International Comparison’, Journal of Transport Economics and Policy 29, 291–304.
Rowe, R. D., C. M. Lang, L. G. Chestnut, D. Latimer, D. Rea, S. M. Bernow D. White (1995), The New York Environmental Externality Cost Study. Oceana Publications, NY.
Shoup, D. C. (1997), ‘Evaluating the Effects of Cashing out Employer-paid Parking: Eight Case Studies’, Transport Policy 4(4), 201–216.
Simpson, D. (1991), ‘The EMEP MSC-W Photo Oxidant Model’, in T. Iversen, ed., Comparison of Three Models for Long-Term Photochemical Oxidants in Europe. Oslo: EMEP.
Small, K. (1983), ‘The Incidence of Congestion Tolls on Urban Highways’, Journal of Urban Economics 13, 90–111.
Small, K. A. (1992), Urban Transportation Economics. Harwood Academic Publishers.
UK Department of Environment (1996), Airborne Particulate Matter in the United Kingdom. London: HMSO.
Vickrey, W. S. (1969), ‘Congestion Theory and Transport Investment’, American Economic Review 59, 251–260.
Vickrey, W. S. (1963), ‘Pricing in Urban and Suburban Transport’, American Economic Review 53, 452–465.
Walls, M. (1992), Differentiated Products and Regulation: The Welfare Costs of Natural Gas Vehicles. Washington DC: Resources for the Future.
Walters, A. A. (1961), ‘The Theory and Measurement of Private and Social Cost of Highway Congestion’, Econometrica 29, 676–699.
Zudema, T. and A. Nentjes (1997), ‘Health Damage of Air Pollution: An Estimate of a Dose-Response Relationship for the Netherlands’, Environmental and Resource Economics 9, 291–308.
Author information
Authors and Affiliations
Corresponding author
Rights and permissions
About this article
Cite this article
Calthrop, E., Proost, S. Road Transport Externalities. Environ Resource Econ 11, 335–348 (1998). https://doi.org/10.1023/A:1008267917001
Issue Date:
DOI: https://doi.org/10.1023/A:1008267917001