Skip to main content

Research Repository

Advanced Search

Model choice and optimal congestion

David, Quentin; Foucart, Renaud

Authors

Quentin David

Renaud Foucart



Abstract

We study the choice of transportation modes within a city where commuters have heterogeneous preferences for a car. As in standard models of externalities, the market outcome never maximizes aggregate welfare. We show that in the presence of multiple equilibria problems of coordination can worsen this result. We discuss two policy tools: taxation and traffic separation (e.g. exclusive lanes for public transportation). Setting the optimal policy is a necessary but not sufficient condition to maximize aggregate welfare. Even with a social planner maximizing aggregate welfare, a city may find itself stuck in a situation where public transportation remains inefficient and the level of congestion high.

Citation

David, Q., & Foucart, R. (2014). Model choice and optimal congestion. Regional Science and Urban Economics, 48, 12-20. doi:10.1016/j.regsciurbeco.2014.04.005

Journal Article Type Article
Acceptance Date Apr 7, 2014
Online Publication Date Apr 25, 2014
Publication Date Sep 30, 2014
Deposit Date May 21, 2018
Publicly Available Date Mar 29, 2024
Print ISSN 0166-0462
Publisher Elsevier
Peer Reviewed Peer Reviewed
Volume 48
Pages 12-20
DOI https://doi.org/10.1016/j.regsciurbeco.2014.04.005
Public URL https://nottingham-repository.worktribe.com/output/1127241
Publisher URL https://www.sciencedirect.com/science/article/pii/S0166046214000404

Files




You might also like



Downloadable Citations