ABSTRACT

Whether roads are publicly or privately owned, the efficient use of congested facilities requires the imposition of extra charges during periods of extra demand. This is known as congestion pricing. Such views about congestion pricing have been around for a long time and came into fashion again in the 1960s. There was the realization that road building could not be the sole answer to solving traffic problems. New roads occupy space, are costly, and take considerable time to be completed. Road building programs cannot keep pace with the increase in vehicle population. To keep traffic problems within manageable levels, there has to be a lid on the amount of vehicle usage on the roads. When a motorist uses the road, he is only aware of the cost incurred to him for his immediate needs, such as paying for gasoline. When there is no traffic congestion, these costs may approximate total costs. But as traffic increases and there is congestion, the motorist imposes cost on the community that rise above private costs. Congestion pricing works on the principle that the motorist should pay for all the costs of his trip, including congestion costs. When a motorist pays all the costs of his trip, he will be more selective and discriminating in making his trips resulting in a more efficient distributing of trip time and places.