Scandinavian Working Papers in Economics

Working papers in Transport Economics,
CTS - Centre for Transport Studies Stockholm (KTH and VTI)

No 2014:24: Race to the top in traffic calming

Stef Proost () and Jonas Westin ()
Additional contact information
Stef Proost: Katholieke Universiteit Leuven, Postal: Centrum för Transportstudier (CTS), Teknikringen 10, 100 44 Stockholm, Sweden
Jonas Westin: Centre for Regional Science, Umeå University, Postal: Centrum för Transportstudier (CTS), Teknikringen 10, 100 44 Stockholm, Sweden

Abstract: We study the competition of two suburbs that are facing transit traffic flows. We show that in the absence of toll measures, the Nash equilibrium leads to a race to the top in traffic calming, except for the measures that do not affect the generalized cost of traffic. The Nash equilibrium is compared to two types of centralized decisions: the symmetric solution and the asymmetric solution. It is shown how the asymmetric solution that concentrates all transit traffic in one suburb is better but can only be realized if the authority over the local roads is transferred to the central authority.

Keywords: Transport; Externalities; Traffic calming; Multi-level government; Regulation

JEL-codes: H23; H77; Q58; R41; R48

26 pages, December 2, 2014

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CTS2014-24.pdf PDF-file 

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