The Case for a Congestion Tax
Urban road congestion constitutes one of the most serious transport problems of today. An outstanding general survey of the problems of congestion, consisting mainly of an analysis of the relationship between road widths and design, traffic flows and vehicle speeds, was contained in Professor R. Smeed’s inaugural lecture, which has now been published . One method of dealing with the problem of congested urban roads which has been the subject of a considerable amount of recent discussion is the possibility of using the price mechanism to ration scarce road space. The basic case for a ‘congestion tax’ was set out in a report from a Ministry of Transport Panel, meeting under the Chairmanship of Professor Smeed, which was published in 1964 . The theoretical arguments however were originally developed by Pigou in his discussion of a firm’s purchases under conditions of rising costs caused by decreases in the physical productivity of factors of production.
KeywordsTraffic Flow Traffic Noise Road User Price Mechanism Direct Route
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