Private Access Fees and Congestion: Is There a Role for Government after All?

Salant, Stephen W.; Seegert, Nathan

doi:10.2139/ssrn.2537848

Cited by 3 publications

(4 citation statements)

References 31 publications

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“…For a detailed discussion of when this condition is likely to hold, see Salant and Seegert (2014) The equilibrium of the subgame in the second stage for the price mechanism is characterized by the updated mobility condition,…”

Section: I) Population Distributionmentioning

confidence: 99%

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Barriers to Migration in a System of Cities

Seegert

2014

SSRN Journal

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This paper creates a model where heterogeneous cities, in production and quality of life amenities, are created under different policy regimes that create barriers to migration. When policies are set by local governments, too many cites are created and these are biased toward providing high quality of life amenities. If instead, there are no policies that limit migration, too few cities are created and these are biased toward high production amenity cities. In contrast, this paper demonstrates a market mechanism (implementable through local zoning regulations) that provides the incentives for individuals to create and move across cities efficiently, despite the lack of coordination across cities. These results demonstrate the importance of accounting for barriers to migration and agglomeration benefits when estimating production and quality of life amenity levels. Otherwise, if there is path dependence in city growth, the estimated amenity levels will be biased toward cities with amenities important in previous centuries.

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Section: I) Population Distributionmentioning

confidence: 99%

“…For a larger discussion on the generality of Knight's result see Salant and Seegert (2014). a set of cities but also that the efficient set of cities is created.…”

Section: Introductionmentioning

confidence: 99%

Barriers to Migration in a System of Cities

Seegert

2014

SSRN Journal

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“… Readers preferring a derivation of the best‐reply of each duopolist in response to any conjectured toll of the other player (even non‐equilibrium conjectures) should consult Salant and Seegert (). …”

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confidence: 99%

“… As depicted in Figure , there are even equilibria with aggregate commute times longer than in the solution with no uncongestible road. We provide intuition here and refer readers to Salant and Seegert () for a proof. Suppose that there are two congestible roads with different congestion functions, and consider the aggregate commute time in the unique but inefficient equilibrium when c = c I .…”

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Should Congestion Tolls be Set by the Government or by the Private Sector? The Knight–Pigou Debate Revisited

Salant

Seegert

2017

Economica

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This paper clarifies issues debated by A. C. Pigou and Frank Knight about correcting inefficient use of congestible resources, focusing for concreteness on their original example of road congestion. Instead of government-imposed Pigouvian access fees, Knight favoured access fees set by private toll-setters. We consider the case of n≥2 congestible roads and an uncongestible road of arbitrary speed. Knight argued that in the case of a single congestible road, a private toll-setter would always choose the toll that Pigou recommended, hence the allocation would minimize aggregate commute time without government meddling. We find instead that two or more toll-setters would never choose Pigouvian tolls except in the special case of a sufficiently fast uncongestible road. Moreover, for uncongestible roads of slower speed, the allocation of motorists under Knight's proposal is almost never efficient. Whenever it is inefficient, motorists are strictly worse off when they pay tolls set by private firms instead of paying governmentimposed tolls, and aggregate toll revenue is also lower. Nevertheless, if the private sector does set tolls, then the full cost to motorists can be limited if the government provides an uncongestible alternative, such as a train, to offer potential competition along the same route.

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Should Congestion Tolls Be Set by the Government or by the Private Sector?: The KnighttPigou Debate Revisited

Salant

Seegert

2017

SSRN Journal

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Private Access Fees and Congestion: Is There a Role for Government after All?

Cited by 3 publications

References 31 publications

Barriers to Migration in a System of Cities

Barriers to Migration in a System of Cities

Should Congestion Tolls be Set by the Government or by the Private Sector? The Knight–Pigou Debate Revisited

Should Congestion Tolls Be Set by the Government or by the Private Sector?: The KnighttPigou Debate Revisited

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