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

Abstract: This paper performs an ex-post cost- benefit and equity analysis of the Gothenburg congestion charges introduced in 2013. We base the analysis on observed effects transport model that is able to predict the effect of the charges on travel times and traffic volumes with high accuracy. We find that the net social benefit of the charge is positive. However, we also show that the system is regressive. Low income citizens pay a larger share of their income for three reasons. First, all income classes are highly car dependent in Gothenburg, due to the relatively low public transport share. Second, workers in the highest income class have considerably higher access to company cars, and are therefore either exempt from paying the charge, or can deduce the charge from their income tax. Third, high income individuals have higher values of time. Moreover, the revenue is spent mainly on a rail tunnel, which primarily benefits commuters residing far out in the region.

Keywords: Congestion charges; Cost-benefit analysis; Welfare analysis; Equity; Transport policy; Decision support

JEL-codes: R41; R42; R48

27 pages, August 29, 2016

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CTS2016-17.pdf  

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