Spatial Economics Seminar Amsterdam

Speaker(s)
Mogens Fosgerau (Technical University of Denmark)
Date
2012-02-20
Location
Amsterdam

We consider commuting in urban areas with bottleneck congestion. User cost is the sum of travel time cost and early/late schedule delay costs. With one bottleneck, an efficient time-varying toll eliminates queuing. However, tolls are often not acceptable, due to political opposition. We study the benefit of a substitute: a parking fee at the workplace. An optimal time-varying parking fee is zero when there is queuing and eliminates queuing when it is non-zero. Within certain limits, inability to charge some travelers for parking does not reduce the potential welfare gain. Commuters who cannot be charged, travel when there is queuing.