Congestion charge as the regulatory tool of a transport system

Abstract

Congestion increases private transport costs and contributes to the decline of public transport service. While these two phenomena are logically connected, in most cities they are institutionally and financially separated. In principle, vehicular users of congested urban road space should be charged a price at least equal to the short-run marginal cost of use, including congestion, road wear and tear, and environmental impacts. Charging for road infrastructure is the core of a strategy for both efficient allocation of resources and sustainable finance. Cordon pricing and tolling of specific roads can be a step in the right direction, but the long-term solution lies in more systematic fields and congestion charges are only the part of them. It is recognized that introducing these charges is quite difficult, requiring policy maturity at both city and national levels, and careful technical, administrative and political preparation.